Report: CEO of BP Failed To Keep Workers Safe

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The chief executive officer of BP Plc, John Browne, failed to provide the leadership needed to keep the company’s American refineries safe, according to a report from a panel convened after a blast at a Texas plant killed 15 people.

The report yesterday, from a committee led by former Secretary of State James A. Baker III, said London-based BP didn’t establish the common standards and practices needed for its American plants. High turnover among plant managers, a lack of resources and poor communication contributed to the breakdown, the report said.

“BP had not made certain that its management and U.S. refining workforce understood what was expected of them regarding process safety,” Mr. Baker said today at a press conference in Houston. Process safety, which refers to engineering, operation and maintenance of refinery equipment, wasn’t established “as a core value across all of its five U.S. refineries,” he said.

BP last week pushed up the retirement of Mr. Browne, 58, by more than a year and named a successor. The Baker report cited the respect Browne has garnered in more than a decade running BP and in making the company a leader on issues such as climate change, contrasting that record with his failures on safety.

“In hindsight, the panel believes that if Browne had demonstrated comparable leadership on and commitment to process safety, that leadership and commitment would likely have resulted in a higher level of process safety performance,” the report concluded.

Tony Hayward, who will replace Browne in August, faces the task of restoring the company’s credibility after the explosion, a pipeline oil spill in Alaska, delays on its biggest Gulf of Mexico production platform and allegations from American regulators that BP manipulated fuel markets.

Shares of BP, Europe’s second-largest oil company, have fallen 4.5% since the day before the March 2005 blast. Exxon Mobil Corp. shares have risen 17%. BP today fell 8 pence, or 1.5%, to 541 pence in London.

The report “is quite damning,” said David Hart, senior analyst with Fat Prophets in London. “It is penny wise and pound foolish to discard safety measures.”

BP plans to meet with the Baker committee within a week, the company said in a statement. The company, which said it will implement Baker’s recommendations, plans to spend an average of $1.7 billion in each of the next four years to improve the safety and integrity of its U.S. refineries.

“BP gets it and I get it, too,” Mr. Browne said yesterday at a press conference via a video-link from London. “This has happened on my watch and as CEO, I have the responsibility to learn from what has happened. I recognize the need for improvement.”

Baker said BP failed to implement “a comprehensive and effective process safety system” or “a common, unifying process-safety culture” at its refineries.


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