BP to sell one of its biggest problems


BP said it plans to sell its Texas City refinery, unloading a plant that has been a source of consistent problems for the company for more than six years. Selling the plant is something I first suggested back in August, after a new round of environmental issues and litigation erupted at the refinery.

After BP acquired the refinery in its 1998 merger with Amoco, it repeatedly cut costs to squeeze some quick cash out of the place. But fatal accidents in 2004 were an early warning of a disastrous explosion in March 2005 that killed 15 people and injured more than 170.

Since then, BP has spent more than $1 billion making improvements to the refinery, and another $1.5 billion settling civil claims related to the 2005 accident. It paid a $50 million fine to settle federal environmental charges.

Last year, it paid another $50 million fine for failing to correct safety hazards at the refinery since 2005, and its still negotiating with the Occupational Safety and Health Administration over $30 million more.

Meanwhile, the Texas attorney general sued BP last year for illegally releasing contaminants from the plant. The release was the result of a fire at a unit that relates to some of the violations for which BP was cited five years ago.

As I pointed out in a column last summer, it certainly seems that BP can’t afford to keep operating the refinery, given that it seems unable to operate it safely.

Typically, asset sales raise concerns among employees about job cuts and other changes. Given the history of BP’s Texas City refinery, though, it seems unlikely a new owner would make anything other than improvements. BP already had been adding staff, having slashed its work force to the bone earlier.

While BP has made more than $1 billion of improvements in recent years, the new owners will have to recognize that they still need to invest in improving the safety culture at the refinery.

Categories: Gulf oil spill, Social
Loren Steffy

4 Responses

  1. Geaux Irish says:


    The Texas City Refinery currently owned by BP was part of Amoco when BP and Amoco announced their merger in 1998. From what I can recall, the refinery had always been Amoco’s.

  2. Jason says:

    Who operated the plant before BP? Did it not exist before BP acquired it?
    Having worked for the illustrious Texas City Sun – I had the pleasure to meet and get to know many of the fine folks in and around Texas City who were affiliated with the plants.
    You won’t find a greater group of individuals. They’ll find a way and be back stronger than ever.

    Nobody said the dike would be fishable again….this is simply a change of ownership.

    Good luck Texas City. You’ll be fine.

  3. C J n Cut n Shoot says:

    Email me back Mr Steffy why you will not post my comments. It must be for the use of Bastards which is not a curse word and has been used in many publications to describe an illegitimate child. You are aware of the distinction are you not?

  4. pdh42 says:

    I imagine people like you Mr. Steffy are laughing at our demise…. Trust me when I tell you that we are laughing at the demise of the newspapers and will not feel sorry when you all close down….