The Baker Panel Report - ABSA

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BUSINESS UNIT (REFINERY)Each refinery represents an individual business unit. The refinery plant manager is responsible for a host of activities and objectives relating tonumerous aspects of the business, including safety. 18 Refinery plant managers also are responsible for identifying site risks; implementingGroup standards, minimum expectations, and ETPs; and delivering the refinery’s objectives. 19 Each refinery develops a strategic, long-termplan and then prepares annual plans or objectives consistent with the longer-term plan. The annual plan contains aspirations, targets, keyperformance indicators, and historical data, as well as a discussion of key risks, including safety-related risks. Refineries also prepare andmaintain their own procedures and technical practices in recognition of the different vintages, conditions, technologies, equipment, andprocesses in each of the refineries, as well as unique local rules and regulations.C. U.S. Refining Organizational ChartBP’s overarching philosophy is that safety accountability always runs through the line, with support and challenges from a variety of functions.Accordingly, several strands of BP’s organizational chart have a material impact on process safety management and culture in theU.S. refineries. First and foremost is refining line management, which runs from the senior managers for the Refining strategic performanceunit to the refinery plant managers. This line is highlighted in pink on the organizational chart that appears in Appendix C. (For simplicity, thechart ends with the plant manager of each refinery, although additional layers of management and supervision exist beneath the plantmanager.) While BP’s executive management above the refining strategic performance unit—the Group Chief Executive and the ChiefExecutive, Refining and Marketing—are accountable for the safety of the U.S. refineries, they do not actively manage refinery operations.Beyond line management, seven other strands on the BP organizational chart influence process safety management and safety culture in theU.S. refineries: the new Safety and Operations function, which is centralized at the BP Group level (highlighted in green); the Group Technology function, including Engineering and Integrity Management (highlighted in purple); the Group Vice-President HSSE and Technology, Refining and Marketing segment and personnel reporting to her (highlighted inyellow); the Refining Technology function (highlighted in light blue); the HRO Manager (highlighted in brown); the new position of Vice-President OMS/PSM Program Implementation (highlighted in red); and BP America personnel (highlighted in gold).In addition to the relationships described above, two informal staff support organizations operating within Refining Technology are relevant:the HSSE Network and the Process Safety Community of Practice. Finally, BP is creating a new informal engineering authority reporting line thatwill cut across four of these organizational strands. The roles of executive management, line management, and each of these seven otherstrands of the corporate organization are discussed below.EXECUTIVE MANAGEMENTUnder BP’s Management Framework, the Board delegates accountability for all of BP’s operations to the Group Chief Executive, John Browne,who is based in London. In his interview with the Panel, Browne acknowledged his accountability for all aspects of BP’s operations, includingsafety. Browne in turn delegates responsibility for managing BP’s operations to the respective segment chief executives.Overview of BP’s Organizational Structure and Its Five U.S. Refineries C 32
Browne, who has a diverse background, has been instrumental in shaping BP’s corporate culture. Browne has a degree in physics and an M.B.A.He is a Chartered Engineer and President of the Royal Academy of Engineering. He rose through the Exploration and Production segment of BPbefore his appointment as Group Chief Executive in 1995. 20 Given the significance of the Exploration and Production segment to BP, it is hardlysurprising that the Group Chief Executive would come from that part of the company or that he would not have any meaningful refiningexperience.Browne has been a director of BP since 1991. 21 He was knighted in 1998 and made a life peer in 2001. 22 In July 2006, BP announced thatBrowne will retire at the end of 2008. 23Browne delegates authority for all aspects of the Refining and Marketing segment including safety to John Manzoni, the Chief Executive,Refining and Marketing, who is also based in London. In this position, Manzoni is responsible for all activities in the Refining and MarketingSegment’s strategic performance units, including Refining. While Manzoni is accountable for BP’s refining operations, he does not managethem.Manzoni is a petroleum engineer by education and, like Browne, rose through BP’s Exploration and Production segment. Manzoni has alsoserved in a number of planning, strategic, and regional positions before his appointment as Chief Executive, Refining and Marketing in April2002. BP appointed Manzoni to this position upon the retirement of an Amoco-heritage refining and marketing executive. Manzoni had norefining experience before this appointment.CORPORATE REFINING LINE MANAGEMENTThe Group Vice-President, Refining is accountable to the Chief Executive, Refining and Marketing for determining refining strategy, priorities,and organization; agreeing to high-level financial targets; entering into performance contracts with refining vice-presidents and refinery plantmanagers; conducting planning and performance reviews; and improving leadership and management skills for senior refining managers. Heis, in effect, the most senior line manager of BP’s refining operations.Mike Hoffman, the Group Vice-President, Refining, has been responsible for BP’s Global refining operations. He reports to the Chief Executive,Refining and Marketing (Manzoni) and has been based in London. Prior to his appointment to this position in 2002 after the retirement of anAmoco-heritage refining executive, Hoffman held various engineering, supervisory, and management positions.Hoffman is a chemical engineer by education, and he held a variety of positions in refining at ARCO from 1980 through 1995. ARCO namedHoffman the refinery plant manager at the Carson refinery in 1998, following a three-year rotation in planning positions. Under the ARCOmanagement structure, the refinery plant manager was responsible for refining operations, but not for financial performance. Many peoplecredit Hoffman for dramatically improving Carson’s safety performance and culture.Prior to 2003, BP configured its refineries into “peer groups,” and all of the refinery plant managers worldwide reported directly to the GroupVice-President, Refining. In 2003, BP determined that the Group Vice-President, Refining had too many direct reports, so BP created three newregional vice-president positions: North America, Rhine, and International. These three new positions report directly to the Group Vice-President, Refining, with the refinery plant managers reporting directly to the appropriate regional vice-president. BP named Pat Gower as theRefining Vice-President, U.S. Region at that time.Gower manages the business of BP’s U.S. refineries. He reports to the Group Vice-President, Refining, and he is accountable for, among otherthings, managing the performance of refineries in the region; ensuring that refinery-specific priorities are challenged and aligned across theOverview of BP’s Organizational Structure and Its Five U.S. Refineries C 33
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JANUARY 2007THE REPORT OFTHE BP U.S
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PANEL STATEMENTProcess safety accid
Page 5 and 6: RETIRED ADMIRAL FRANK L. “SKIP”
Page 7 and 8: DR. NANCY LEVESON is a Professor of
Page 9 and 10: DR. DOUGLAS A. WIEGMANN, Ph.D. is t
Page 11 and 12: • Dennis C. Hendershot, Principal
Page 13 and 14: The Panel’s FindingsThe Panel foc
Page 15 and 16: Process safety cultures at BP’s U
Page 17 and 18: Process safety audits. The Panel fo
Page 19 and 20: RECOMMENDATION #5 - CLEARLY DEFINED
Page 23 and 24: TABLE OF CONTENTSI. The Panel’s R
Page 25 and 26: A. Scope and MethodologyI. THE PANE
Page 27 and 28: interview, and at least one attorne
Page 29 and 30: PROCESS SAFETY REVIEWSThe CSB’s u
Page 31 and 32: BP requested that the Panel use the
Page 33 and 34: would be positive from a process sa
Page 35 and 36: more of the Panel’s recommendatio
Page 37 and 38: management systems. The charter doe
Page 39 and 40: observed at BP are likely not limit
Page 41 and 42: II. PRECIPITATING EVENTS FOR THE PA
Page 43 and 44: As the Mogford Report explains, the
Page 45 and 46: III. OVERVIEW OF PROCESS SAFETY, PE
Page 47 and 48: elated to personal safety performan
Page 49 and 50: ENDNOTES FOR SECTION III1 29 C.F.R.
Page 51 and 52: IV. OVERVIEW OF BP’S ORGANIZATION
Page 53 and 54: Although lower levels of supervisor
Page 55: segment includes the manufacturing
Page 59 and 60: BP provides no specific training fo
Page 61 and 62: The new Safety and Operations funct
Page 63 and 64: The primary purposes of this new or
Page 65 and 66: maintain a culture in which reliabi
Page 67 and 68: TEXAS CITYBP acquired the Texas Cit
Page 69: 25 BP evaluates (1) “Level 5 Lead
Page 72 and 73: (7) pre-start-up safety review,(8)
Page 74 and 75: Assessment, assurance, and improvem
Page 76 and 77: BP control of work standardBP issue
Page 78 and 79: BP PROCESS AND PERSONAL SAFETY BOOK
Page 80 and 81: ENDNOTES FOR SECTION V1 BP addresse
Page 83 and 84: A. Corporate Safety CultureVI. FIND
Page 85 and 86: Process safety as a core value in B
Page 87 and 88: contractors and employees in the pr
Page 89 and 90: A fourth and similar survey item ad
Page 91 and 92: The Panel recognizes that Browne is
Page 93 and 94: BP management’s focus on personal
Page 95 and 96: milestones to guide the efforts of
Page 97 and 98: Refinery plant manager turnoverUnde
Page 99 and 100: EMPLOYEE EMPOWERMENTThe Panel belie
Page 101 and 102: Survey responses substantiate that
Page 103 and 104: As discussed later in this section,
Page 105 and 106: U.S. refinery staff and capabilityB
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In 2002, BP commissioned a report b
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The process safety culture survey r
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Worker fatigue and overtimeThe Pane
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As demonstrated below, process safe
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decision to reduce spending on insp
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environmental, and operational goal
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THE PROCESS SAFETY CULTURE AT EACH
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Finally, the Panel’s own observat
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Survey responses from Cherry Point
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process safety culture at the refin
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Table 22‘‘I can report hazardou
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The Panel found other issues that c
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Table 27“In my opinion, process s
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(2) accountabilities for protection
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All levels of management reported t
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Table 32“The training that I have
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Hourly workers interviewed largely
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Table 34“Refinery management puts
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Finding:Each of BP’s five U.S. re
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Table 36“Workers sometimes work a
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Finally, relatively high percentage
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Also indicative of perceived noncom
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ENDNOTES FOR SECTION VI.A1 Meredith
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51 Ibid, p. ii.52 Ibid, p. 153.53 I
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Finally, because the nature and sco
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At the Carson, Cherry Point, and To
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The 2003 audit report for BP South
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COMPLIANCE WITH INTERNAL PROCESS SA
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Table 40Percentages of Disagree/Ten
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Prioritization of inspections and m
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Whiting (2006) Not all of the alarm
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Point have implemented the standard
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the facility siting risk to personn
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The ANSI Z490.1-2001 standard provi
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key positions, BP should assess and
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interviews at some of the refinerie
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Information relating to BP’s Texa
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Computer-based training. Based upon
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TRANSLATING CORPORATE EXPECTATIONS
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In early 2005, prior to the Texas C
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The table below contains the substa
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Interviews with various members of
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BP’S PROCESS SAFETY MANAGEMENT SY
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usiness units, to prioritize implem
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Turnaround deferral procedure (Cars
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on December 4, 2006. In that recomm
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C. Performance Evaluation, Correcti
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valves, and other safety-related eq
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Tracking of process safety indicato
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Table 57Number of Overdue Inspectio
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Although the Panel recognizes that
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Previous concerns about measuring p
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BP’s efforts to develop process s
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BP’S INVESTIGATION AND ROOT CAUSE
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The Panel also identified some defi
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Similarly, although mixed responses
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Other external reviews of BP’s pr
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Table 62Number of Reported Near Mis
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Table 64Percentage of Agree/Tend to
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BP’S PROCESS SAFETY AUDIT SYSTEM>
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compliance or BP policy (Priority 1
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Interviews with members of the Safe
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Refining line management above the
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The audit team found similar proble
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The issues that the Panel’s techn
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USING RESULTS OF INCIDENT INVESTIGA
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Issue Grangemouth Texas CitySafety
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CORPORATE OVERSIGHTAn effective pro
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Selected excerpts from the EEAC rep
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Group- and refining-level process s
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Knowledge of performance management
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Each member of the board needs to a
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ENDNOTES FOR SECTION VI.C.1 America
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43 Health & Safety Executive, Devel
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82 When conducting reviews, BP desi
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138 Health & Safety Executive, Majo
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cultures, process safety management
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(i) implement a policy regarding ar
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(f) educate and provide training to
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workers are educated, encouraged, a
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RECOMMENDATION #6—SUPPORT FOR LIN
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(3) “periodically update”—The
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RECOMMENDATION #9—BOARD MONITORIN
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ANNEX I—PROCESS INCIDENT INDEX EX
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a fatality that results from a mech
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III. Structure and Operations The C
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11. On August 10, 2005, the Texas C
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APPENDIX CBP U.S. REFINING ORGANIZA
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APPENDIX DWHITING RUPTURE DISK: A C
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B. INADEQUATE REVIEW AGAINST TECHNI
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management review or monitoring pro
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214-06GEMS 1544316Review of Process
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Executive SummaryOn March 23, 2005,
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Based upon its work, the PSM Review
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Table of ContentsSectionPageExecuti
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1. IntroductionOn March 23, 2005, t
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Following these general sampling pr
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Review of documentsWalkaround inspe
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3. Discussion of FindingsBased upon
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3.1 Rupture Disks Under Relief Valv
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3.2 Equipment Deficiencies - Known
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Once a site specifies the frequenci
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System Finding 3 - Equipment inspec
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accepted good engineering practice
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Not implementing action items or ta
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3.9 Compliance Audit Findings - Rep
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3.11 Near-miss Investigation - Inad
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from water. However, the PHA report
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Appendix A - Scope of Work for BP I
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v. Safety instrumented system desig
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Appendix B - PSM Review Team Leader
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Jack McCavitMr. McCavit is Presiden
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14 Guidance on Practice for Design
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Operations network.performance.Refi
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C. Performance Evaluation, Correcti
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APPENDIX GPROCESS SAFETYCULTURE SUR
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INTRODUCTIONWelcome to the BP U.S.
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I. ABOUT MEIn this section you are
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SURVEY TERM DEFINITIONSPlease read
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Safety Values / Commitment to Proce
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Procedures and EquipmentNote: For e
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Process Safety TrainingNote: For ea
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PLEASE DO NOT WRITE ON THIS PAGE.14
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TermHSSEIncidentISAIsomerization (I
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ACKNOWLEDGEMENTSMembers of the BP U
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The Baker Panel Report - ABSA

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