The U.S. Chemical Safety Board (CSB) proposes recommendations for substantial changes to the way refineries are regulated in California. The CSB Chevron Regulatory Report draft calls on California to replace the current patchwork of largely reactive and activity-based regulations with a more rigorous, performance-based regulatory regime. The draft CSB Chevron Regulatory Report is the second part of three in the CSB’s investigation of the August 2012 process fire in the crude unit at the Chevron refinery in Richmond, California. That fire endangered 19 workers and sent more than 15,000 residents to the hospital for medical attention.
The draft CSB Chevron Regulatory Report is available at www.csb.gov for public comment until Friday, January 3, 2014. Comments should be sent to [email protected]. All comments received will be reviewed and published on the CSB website.
The draft report – which is expected to be considered for formal adoption by the Board at a public meeting at 6:30 p.m. on January 15, 2014, at Richmond City Hall – follows the CSB’s first, interim report on the accident, which was approved by the Board and released in April 2013. That report found that Chevron repeatedly failed over a ten- year period to apply inherently safer design principles and upgrade piping in its crude oil processing unit, which was extremely corroded and ultimately ruptured on August 6, 2012.
The draft report recommendation of a “safety case report” – would define how major hazards are to be controlled and risks reduced to “as low as reasonably practicable,” or ALARP. The CSB report notes that the safety case is more than a written document; rather, it represents a fundamental change by shifting the responsibility for continuous reductions in major accident risks from regulators to the company.
The draft CSB Chevron Regulatory Report states there is “a considerable problem with significant and deadly incidents at petroleum refineries over the last decade. In 2012 alone, the CSB tracked 125 significant process safety incidents at U.S. petroleum refineries. Seventeen of these took place in California.” The draft report also notes that the U.S. has experienced financial losses from refinery incidents that are at least three times that of industry counterparts in other countries, citing insurance industry statistics.”
The CSB is an independent federal agency charged with investigating serious chemical accidents. The agency’s board members are appointed by the president and confirmed by the Senate. CSB investigations look into all aspects of chemical accidents, including physical causes such as equipment failure as well as inadequacies in regulations, industry standards, and safety management systems.
The Board does not issue citations or fines but does make safety recommendations to plants, industry organizations, labor groups, and regulatory agencies such as OSHA and EPA.
CSB Chevron Regulatory Report findings
The existing California system of regulation can be significantly improved, the report concludes. Since 2010, the CSB has examined the extent to which a safety case regime would improve regulatory compliance and better prevent major accidents, both onshore and offshore. The safety case regime, which originated in Europe, requires high- hazard facilities to demonstrate, to the satisfaction of a competent regulator, that they are able to operate safely, in conformance with the latest safety standards, and at the lowest practicable risk levels. The report illustrates that under a safety case approach, demonstrating control of major hazards is a pre-condition for a refinery to operate.
Dr. Rafael Moure-Eraso said, “In contrast to the safety case, the current regulatory system for process safety is largely reactive, at both the state and federal level; companies have a default right to operate, and are subject to penalties when accidents occur or their activities otherwise draw negative attention from regulators. In the case of the Chevron refinery fire, the reactive system of regulation simply did not work to prevent what was ultimately a preventable accident.”
Don Holmstrom, director of the CSB’s Western Regional Office, which is conducting the Chevron investigation, said, “OSHA’s Process Safety Management [PSM] standard, the EPA’s Risk Management Program, and California’s system do not work consistently to prevent industrial process accidents. What is lacking, and what the safety case regime requires, is an adaptable, rigorously inspected, goal-setting approach, aimed at continuously reducing risks to ‘as low as reasonably practicable’ – known in the industry as ALARP.”
The OSHA PSM standard is a set of requirements for facilities to identify, prevent or mitigate major chemical releases and catastrophic accidents. The current PSM standard requires companies to implement 14 elements to control the hazards from processing chemicals – such as hazard analysis, management of change, and worker training programs.
An extensive analysis comparing actions required by Chevron under the OSHA PSM standard over the years and actions that would have been required had Chevron operated under a safety case regulatory regime. For example, Chevron employees recommended implementing the inherently safer approach of upgrading piping materials to prevent sulfidation corrosion through PSM activities. However, the CSB draft report found that the California process safety regulations do not require that these preventative measures be implemented. Prior to the fire, Chevron had repeatedly failed to implement the proposed recommendations; using inherently safer approaches, on the other hand, is required under the safety case. The CSB found that had Chevron implemented these recommendations, the incident could have been prevented.
California [should] “Develop and implement a step-by-step plan to establish a more rigorous safety management regulatory framework for petroleum refineries in the state of California based on the principles of the ‘safety case’ framework in use in regulatory regimes such as those in the UK, Australia, and Norway.” The recommendation urges specific steps to accomplish this, including ensuring that workers are formally involved in the development of a safety case approach. The report also urges California to work with industry in gathering refinery safety indicator data to be shared with the public.