Statement on Safety Report

BP PLC
16 January 2007

January 16, 2007

                       BP WILL IMPLEMENT RECOMMENDATIONS
                       OF INDEPENDENT SAFETY REVIEW PANEL

HOUSTON -- BP p.l.c. will implement the recommendations made by an independent
safety review panel as part of the company's continuing effort to improve its
safety culture and to strengthen and standardize process safety management at
BP's five U.S. refineries.

BP already has taken a number of actions which align with the recommendations of
the BP US Refineries Independent Safety Review Panel and will, after a more
thorough review, develop plans for additional action at its U.S. refineries and
for applying lessons learned elsewhere.

In a report made public today, the Panel identified material deficiencies in
process safety performance at BP's U.S. refineries and called on BP to give
process safety the same priority BP has historically given personal safety and
environmental performance. The Panel made recommendations for improving BP's
process safety leadership, systems, expertise and oversight of process safety
performance.

The Panel, led by former U.S. Secretary of State James A. Baker, III, was
appointed by BP Group Chief Executive John Browne in October 2005 on the
recommendation of the U.S. Chemical Safety and Hazard Investigation Board (CSB).
BP is cooperating with the CSB in its investigation of the March 23, 2005
explosion and fire at the Texas City refinery that claimed the lives of 15
workers and injured many more.

John Browne said: 'I want to thank Secretary Baker and the other Panel members
for their effort, their insights and their recommendations,' Browne said. 'We
asked for a candid assessment from this diverse group of experts and they
delivered one. We will use this report to enhance and continue the substantial
effort already underway to improve safety culture and process safety management
at our facilities.'

The Panel acknowledged the company's efforts stating that 'since March of 2005
BP has expressed a major commitment to a far better process safety regime, has
committed significant resources and personnel to that end, and has undertaken or
announced many measures that could impact process safety performance at BP's
five U.S. refineries.' The Panel also said that making dramatic change in large
companies is difficult in short time frames and that the ultimate effectiveness
of the actions taken or planned by BP could only be determined over time.

'Many of the Panel's recommendations are consistent with the findings of our own
internal reviews,' said Browne. 'As a result, we have been in action on many of
their recommendations for a year or more. Our progress has been encouraging but
there is much more to do. Members of our refining leadership team will be
meeting with the Panel within the week to address how best to implement these
recommendations.

'I share the Panel's confidence in BP's refining workforce,' Browne added. 'They
are, as the Panel stated, ready, willing and able to participate in a sustained
effort to move BP towards process safety excellence. As I told the Panel, I
intend to ensure BP becomes an industry leader in process safety management and
performance. We will want to do everything possible to prevent another tragedy
like the one that occurred at Texas City.'

Notes to editors

The full text of the report prepared by the BP US Refineries Independent Safety
Review Panel is available at www.bp.com/bakerpanelreport

  • The BP US Refineries Independent Safety Review Panel was established to
    make a thorough, independent and credible assessment of corporate oversight
    of safety management systems at the company's five U.S. refineries and of
    the company's corporate safety culture. The Panel did not investigate the
    Texas City incident or any other past event.

  • The Panel makes clear in Section 1 that its findings 'should not be
    construed as suggesting or determining that any particular individual,
    whether a refinery employee or contractor, refinery manager, corporate-level
    manager or BP board member failed to meet any applicable legal standard, was
    negligent, otherwise committed a wrongful or tortious conduct, or breached
    any duties owed to BP, BP's shareholders or anyone else. Any such finding or
    determination is outside the scope of the Panel's charter. The Panel simply
    did not seek to develop the type of data and evidence that would be
    necessary to make such a finding or determination. The Panel observes,
    however, that during the course of its review, it saw no information to
    suggest that anyone - from BP's board members to its hourly workers - acted
    in anything other than good faith.'

  • The Panel also says that it is under no illusion that the deficiencies in
    process safety culture, management, or corporate oversight identified in the
    report are limited to BP. All companies in the industry should give serious
    consideration to its recommendations.

  • BP has taken significant action to reduce risk and improve process safety
    performance at its U.S. refineries and its other facilities around the
    world. Those actions include:

    • Formation of a senior executive team, which includes several managing
      directors, to support and oversee process safety, integrity management, 
      and operational integrity initiatives within the company.

    • Creation of a new Safety and Operations function responsible for
      establishing Group operations and process safety standards and auditing 
      safety and operations performance. The Safety and Operations function 
      reports directly to the Group Chief Executive.

    • The appointment of a new Group Vice President for Refining familiar with 
      the work of the Panel. Cynthia Warner will move into the position 
      effective April 1, 2007 after serving as the company's liaison with the 
      Panel.

    • Significant expansion of the responsibilities and powers of the Chairman 
      and President of BP America to include monitoring BP's U.S. operations to 
      ensure compliance with regulatory requirements and company standards, and 
      to rectify problems when they are identified. Robert A. Malone, a BP 
      Executive Vice President with significant operations experience, was 
      appointed to the post effective July 1, 2006. He reports directly to the 
      Group Chief Executive.

    • Creation of an advisory board to assist BP America management in 
      monitoring and assessing BP's US operations.

    • Appointment of retired federal Judge Stanley Sporkin to act as a channel 
      for receiving, investigating and resolving concerns raised by BP staff and
      contract workers in the U.S.

    • An increase in spending from $1.2 billion in 2005 to an average of $1.7
      billion per year from 2007 to 2010 to improve the integrity and 
      reliability of our refining assets in the United States. This represents 
      an increase in, and an acceleration of, planned spending.

    • Systems to manage process safety at the refineries are undergoing a major 
      upgrade, with some $200 million earmarked to pay for 300 external experts 
      who are conducting comprehensive audits and re-designs, where necessary, 
      of all process safety systems. The new systems are targeted to be 
      installed and working by the end of 2007, a year ahead of the original
      schedule.

    • Adoption of new corporate standards governing operations integrity 
      management and control of work and the adoption of a new engineering
      technical practice governing the use of temporary occupied structures in
      refineries and other facilities.

    • Significant external recruitment across our US refining businesses to
      increase underlying capability in operations and engineering.

    • Providing focus through the creation of a six point plan, including
      implementation of the Integrity Management and Control of Work Group 
      Standards.

    • Changes in the way safety audits are conducted and results communicated
      within the corporation. The company has appointed a central 60-person
      operations and safety audit team led by an expert recruited from outside 
      the company.

    • Development of metrics as leading indicators of process safety 
      performance.

    • Installation of modern process control systems on major units, the 
      transition to a more powerful maintenance management system, improvements 
      in worker training, and the removal of blow down stacks which vent heavier
      than air light hydrocarbons to atmosphere.

Other background

  • BP has accepted responsibility for the March 23 explosion at the Texas City 
    refinery and for the management system failures and employee mistakes which
    contributed to or caused the explosion.

  • The company has set aside $1.6 billion to compensate victims of the 
    explosion and has worked to resolve claims arising from the incident.
    Settlements have been achieved with the families of every worker who died 
    and with many of the workers who suffered injuries.

  • BP has entered a settlement with the U.S. Occupational Safety and Health 
    Administration resolving more than 300 separate alleged violations of OSHA 
    safety regulations. BP paid a fine of just over $21 million. The company
    agreed to a number of corrective actions, including the hiring and placement
    of process safety and organizational experts at the refinery. Under the 
    agreement, BP does not admit the alleged violations or agree with the way 
    OSHA has characterized them.

  • BP continues to cooperate with the CSB, the U.S. Environmental Protection 
    Agency and the Texas Commission on Environmental Quality regarding the Texas
    City explosion and related concerns.

  • BP has endorsed a CSB recommendation urging the industry to revisit existing
    standards for the use of temporary buildings inside refineries and other 
    processing plants. BP has established a new standard for its refining 
    operations and plans to share it with others in industry.

For further information contact:

Ronnie Chappell, BP Press Office, Houston:  281-366-5174
BP Press Office, London  [phone]

Web cast

http://events.ctn.co.uk/ec/bp/280/client.asp


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