Philadelphia refinery hit with $132,000 fine for violations related to June fire

Federal workplace regulators have cited Philadelphia Energy Solutions for safety violations related to the catastrophic fire and explosions June 21 that released more than 5,000 pounds of deadly chemical and led to the refinery’s closure and bankruptcy.

The U.S. Department of Labor’s Occupational Safety and Health Administration, in a news release Friday, said that PES faces $132,600 in fines for violations related to process safety management, which are the procedures that employers must follow with equipment and processes that involve large amounts of hazardous chemicals.

OSHA said its inspection found deficiencies in the refinery’s process safety management program, including failing to establish or implement written procedures, insufficient hazard analysis, and inadequate inspection of equipment.

The agency cited PES for 10 specific violations, including a failure to inspect an elbow in a section of pipe that had corroded significantly since it was installed 46 years before. The failure of the 8-inch-diameter pipe released a cloud of flammable gas, which triggered three successive explosions that launched large chunks of shrapnel thousands of feet.

“When employers fail to evaluate and address potential hazardous conditions associated with chemical processes, catastrophic events such as this can occur,” OSHA Philadelphia Area Director Theresa Downs said in a statement. “OSHA’s Process Safety Management standard requires that employers conduct regular inspections to ensure process equipment meets industry standards.”

Despite the release of 5,000 pounds of deadly hydrofluoric acid, the incident caused no serious injuries. Only five refinery workers experienced minor injuries that required first-aid treatment, and officials said no members of the public reported health impacts.

The piping circuit in the alkylation unit that ruptured was installed in 1973, and the lines were subject to regular ultrasonic thickness measurements at designated “condition monitoring locations” under a PES inspection program to monitor metal losses due to corrosion. The elbow that ruptured had never been inspected, but a similar elbow just a few feet farther on the line had been inspected, and showed no dangerous wear.

PES shut down and declared bankruptcy after the incident and is undergoing Chapter 11 reorganization. The refinery’s law firm held a closed-door auction Friday to sort out potential bidders for the 1,300-acre South Philadelphia property, where refining has taken place since the 19th century.

The court has set a Feb. 6 hearing to confirm the bankruptcy plan.

PES said it is cooperating with investigations being conducted by several private and governmental entities, including OSHA, the U.S. Department of Justice, the Environmental Protection Agency, the Pennsylvania Department of Environmental Protection, the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives, the Philadelphia Fire Marshal, the Philadelphia Police Department, and several private insurance companies.

PES had 15 business days to respond to the OSHA citation, which was dated Dec. 19. It was unclear if the company is contesting the penalties.

But the refinery on Thursday asked U.S. Bankruptcy Court Judge Kevin Gross to approve the hiring of the Klehr Harrison law firm to represent its employees in connection with the investigations. PES said the cooperation of employees is “critical” to the completion of the investigations, ultimately fostering its reorganization efforts.

“Based upon information currently available, neither the debtors nor Klehr Harrison anticipate that any of the employees will become targets of any of the investigations or that their interests in connection with the investigations will conflict with the interests of the debtors in facilitating a timely completion of the investigations,” PES said in a filing.

However, it said, if any employees become targets, they will be required to retain their own lawyers.