The Scotsman 19 March 2007

OIL giant BP yesterday stonewalled suggestions of a leaked memo that allegedly shows the company's board was aware of the link between spending cuts and poor maintenance at the Texas City refinery two years before the fatal explosion.

It comes a day ahead of the report tomorrow by the US Chemical Safety and Hazard Investigation Board, which for two years has been investigating the cause of the accident which killed 15 workers in March 2005.

A weekend report said an internal BP document showed that a presentation was made to John Manzoni, chief executive for refining and marketing, in November 2003 which linked the "history of reduced investment" at the Texas City refinery with "poor maintenance practices".

A BP spokesman said he had no comment on any such document, but referred to BP chief executive Lord Browne's comments in January.

"At the time of the Baker report in January it was made clear there was no link between spending cuts and impact on safety. He said safety-related spending there [at Texas City] had never been turned down," the spokesman said.

In January an inquiry into BP's refineries, chaired by former US secretary of state James Baker in the aftermath of the accident, said the company emphasised personal safety "but BP did not emphasise process safety".

Baker found there was "a lack of operating discipline, toleration of serious deviations from safe operating practices and apparent complacency toward serious process safety risks" and called for an overhaul of the way BP operates.

One source said yesterday that the latest alleged document leak looked like "someone trying to warm things up ahead of the report of the US Chemical Safety Board".

The reported presentation to Manzoni said fixed costs peaked at $727 million (£364.3m) in the early 1990s before falling to $347m in 1999.

The document, obtained by lawyers representing victims of the accident, reportedly says the refinery "remained in the lowest percentile grouping for operational availability".

Manzoni lost out in the BP succession race to replace the outgoing Browne this summer to boardroom colleague, Tony Hayward, who runs the exploration and energy business.

Tomorrow, the Chemical Safety and Hazards Board investigators are due to publish their final report into the explosion. It is expected to focus on problems with the "mechanical integrity" of the plant.

Alongside the Texas City investigation, the discovery of pipeline corrosion forced BP into the partial closure of Prudhoe Bay, the largest field in the United States, last August.

Despite the problems the company still made profits of $22.25 billion during 2006.