• OSHA Issues New Process Safety Management Standard for Cold Storage and Chemical Manufacturing Facilities
  • January 16, 2012 | Authors: John D. Surma; Collin G. Warren
  • Law Firm: Adams and Reese LLP - Houston Office
  • Background

    In response to the March 23, 2005, explosion at the British Petroleum refinery in Texas City, Texas, and other highly publicized incidents at refineries in California and New Mexico, the Occupational Health & Safety Administration (OSHA) issued a National Emphasis Program (NEP) related to the Process Safety Management (PSM) Standard, 29 CFR 1910.119. The NEP was issued in June 2007, and its purpose was “to reduce or eliminate the workplace hazards associated with the catastrophic release of highly hazardous chemicals at petroleum refineries.” The scope of the NEP was limited to locations with refineries and was not a requirement in those states with “State Programs.”

    Under the NEP, OSHA Compliance Officers were charged with the task of analyzing the interrelationship of the various elements of an employer’s approach to dealing with the hazard associated with the storage and use of certain “highly hazardous chemicals” (HHCs) in the workplace. Compliance with the PSM standard required that the hazards associated with HHCs be abated through both management systems (developing mechanical integrity programs such as piping inspection procedures) as well as specific employer actions (actually performing piping inspections). An inspection under the PSM NEP involved documentary review, employee interviews, contractor interviews, and inspections of the premises.

    In August 2009, OSHA issued a second NEP that extended the time for OSHA to complete the PSM inspections of petrochemical refineries in Regions VI and VIII, which include Arkansas, Iowa, Kentucky, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Tennessee.

    New PSM NEP effective November 29, 2011

    On November 29, 2011, OSHA issued a new NEP relative to the PSM standard. This NEP will be implemented immediately. The NEP specifically states that it does not apply to petroleum refineries (those places of employment with a 32411 NAICS code). It also narrows the categories of covered facilities to (1) those facilities where the only HHCs on site are ammonia used for refrigeration and (2) all other facilities. (It is important to note that cold-storage and other facilities using ammonia for refrigeration are not the only types of workplaces covered by this NEP).

    Area offices will be charged with developing lists of sites potentially subject to this NEP in their jurisdictions. The lists will exempt VPP and SHARP sites, retailers, employers in the oil and gas drilling and servicing business, and normally unoccupied remote locations. Other changes associated with this NEP include a requirement that OSHA verify abatement of conditions that resulted in past PSM citations and a requirement that “State Program” states implement a similar program relative to the PSM standard. The number of required PSM inspections was reduced from the levels required under the prior NEPs.

    Under this NEP, programmed inspections (those that are planned or scheduled with employers) will take place at facilities known to OSHA as having a risk of a release of HHCs. Unprogrammed inspections (those that take place in response to hazardous conditions identified at particular worksites as a result of a complaint or employee injury or death) will be scheduled in one of two ways. First, are those cases where the inspection is the result of a complaint, injury, or death as a result of the application of the PSM standard. In such cases a “Chemical Inspection” will take place. The second approach applies to unprogrammed inspections that take place as a result of a complaint unrelated to the application of the PSM standard. In these latter kind of inspections, OSHA’s Area Director is allowed discretion in terms of whether to conduct a “Chemical Inspection.”

    Significance of the NEP

    Though cold storage and chemical manufacturing facilities that use ammonia as a refrigerant have come under increased scrutiny by OSHA over the last couple of years, this NEP will require companies in those industries and all others that have not undertaken the implementation of an appropriate PSM program to do so or face the potential of numerous citations and very significant penalties. Further, for those facilities that received citations under previous versions of the PSM NEP, even greater penalties can accrue in the event abatement measures were not implemented or failed to abate the hazards related to prior PSM standards. In the most egregious of cases, employers who have represented that they abated a PSM hazard and failed to do so could face criminal penalties.