Grangemouth accidents likely to cost BP £500m

A series of accidents at BP’s Grangemouth refining and chemicals complex over the summer is likely to lead to investment of up to £500m to repair and upgrade systems and processes at the plant, it emerged this week.

The most serious incident was a fire in the fractionation section of the refinery’s catalytic cracker on 10 June, which took 60 firefighters several hours to put out. This occurred only three days after an 18-inch steam pipe had ruptured near to a public road and less than a month after a power outage had shut down a number of plants on the site, prompting a site-wide investigation by both the company and Health & Safety Executive.

BP called in a 30-strong taskforce of its own, including outside consultants, to conduct a root-and-branch review of current operations at Grangemouth. The team spent about eight weeks going over the site, and its report is in the final draft stage.

But a BP spokesman said no details could be released until the HSE investigation is completed – which could result in criminal charges – within the next few weeks. A source close to the investigation said, however, that the final bill would certainly run into ‘hundreds of millions, possibly half a billion’ pounds.

It is known that the review covered all equipment, processes and management procedures at Grangemouth, and that BP’s senior management has given the project the highest priority.

Sir John Browne, BP’s chief executive, said earlier this month: ‘We are absolutely determined that as Grangemouth grows it should set new global standards of safety.’ Immediately after the fire, which occurred hours after a local MP had been shown around the site to be reassured about its safety, Browne’s deputy, Rodney Chase, is said to have told Grangemouth director Susan Caito to do ‘whatever it costs’ to restore the confidence of both the regulator and the public.

This suggests that the renewal of plant at the site will go far beyond replacing the catalytic cracker, which has remained closed since the fire, including an extensive revamp of site safety management procedures.