Company Falsified Safety Reporting: 3 dead, $9.5M in Penalties

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March 8, 2017 by Herald and News

New Orleans, L.A. — An oil industry service company has agreed to pay $9.5 million in connection with a Gulf of Mexico explosion that killed three workers. The penalties are for false reporting of safety inspections and Clean Water Act violations.

The penalties against Houston-based Wood Group PSN were announced Thursday by the U.S. Justice Department in Washington and U.S. attorneys in New Orleans and Lafayette, Louisiana, where civil and criminal cases have been playing out. The penalties followed plea agreements.

Wood Group PSN Inc., headquartered in Houston, has agreed to pay:

  • $7 million for falsely reporting that personnel had performed safety inspections on facilities in the Gulf of Mexico
  • $1.8 million for negligently discharging oil into the Gulf of Mexico in violation of the Clean Water Act after the explosion, and
  • $700,000 in community service projects in the areas where the criminal conduct took place.

On Nov. 16, 2012, workers were attempting to use an arc welder when hydrocarbon vapors that had escaped from a tank ignited and exploded. The initial blast set off a series of additional explosions. Two tanks were blown into the Gulf of Mexico. Another tank was blown off its base and destroyed a platform crane.

The fire and explosions resulted in the deaths of three construction workers: Avelino Tajonera, Elroy Corporal and Jerome Malagapo. Others workers were seriously burned.

Wood Group PSN admitted its employees were negligent in the way they authorized hot work and that a lack of communication among personnel on the platform, including Wood Group’s person-in-charge, contributed to the events.

Two other companies that are co-defendants in the case face manslaughter charges. Three individuals face criminal violations of the Clean Water Act.

“We deeply regret these incidents occurred and we cooperated fully with the government and relevant regulatory bodies throughout both investigations,” Wood Group said in a statement

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