APRIL 11, 2001 - Michigan Department of Consumer & Industry Services (CIS) Director Kathleen M. Wilbur today announced a comprehensive Settlement Agreement with Lomac LLC in Muskegon, with a combined total of more than $3 million in penalties and additional activities, and 15 violations. The settlement closes a nine-month investigation of a double explosion at Lomac on April 12, 2000, that injured 10 workers.

This forward-looking resolution to the Michigan Occupational Safety and Health Act (MIOSHA) investigation of the Lomac explosion was signed by: Lomac, LLC; Union Local 854C (International Chemical Workers Union Council/United Food & Commercial Workers Union); and CIS.

"During the past decade, MIOSHA has identified significant workplace safety and health violations at Lomac," said Wilbur. "This Settlement Agreement represents a strong commitment by Lomac to diligently protect their workers and undertake activities that go beyond MIOSHA regulations to enhance worker and community safety."

The Settlement Agreement agreed to by the company includes an action plan with 15 safety enhancement initiatives. The key elements of the action plan, besides the $150,000 penalty and abatement of all cited hazardous conditions, include the following activities.

• The company will never restart the process where the explosion occurred (herbicide production process).
• The company will notify CIS prior to the commencement of any new commercial production processes.
• The company will remove, and properly dispose of, six highly hazardous chemicals, six flammable chemicals and two other chemicals from the premises.
• The company will pursue process analysis and review of their chemical operations to achieve lasting improvements in workplace safety and health, as well as community protection.
• The company will support the local fire fighting agency (Egelston Township) through financial donations and annual training programs.

CIS Deputy Director Dr. Kalmin Smith and MIOSHA officials negotiated the Settlement Agreement. In developing this agreement with the company and the union, MIOSHA determined it was critical to ensure that future operations at the company would be conducted with workplace safety and health as a top priority.

"The workers at this company and all companies in Michigan must be afforded a safe and healthy workplace," said Smith. "This agreement provides the foundation and framework for immediate improvements, as well as the prevention of future incidents."

"We are pleased that Lomac has agreed to make the safety and health improvements provided for in this agreement," said Smith. "We are also pleased that most of the costs in this agreement are dedicated to protecting workers and the community, rather than expended on prolonged litigation."

MIOSHA investigations do not determine the cause of an accident. Rather, they focus on identifying violations of worker safety and health standards at the time of an accident.

Summary of Violations and Settlement Agreement

Lomac LLC

Accident Background

Lomac LLC produced two synthetic organic chemical products: 3,3'-dichlorobenzidine (DCB), an intermediate organic chemical that is used to make yellow inks and pigments; and Oryzalin™, a proprietary herbicide compound. They employed about 160 workers at the time of the accident

At approximately 1:10 p.m., April 12, 2000, two explosions occurred in rapid succession at Lomac in the area of the plant where Oryzalin™ was made. Eight workers sustained injuries requiring hospitalization: four pipefitters from Northern Boiler and Mechanical Contractors, Inc.; one field service agent from Bertsch Instrumentation Technology; and three Lomac employees. Two other Lomac employees, who were injured during the evacuation after the blast, were treated on an outpatient basis. The contract workers were installing two tanks and upgrading the waste treatment system at the site of the explosions.

The first, smaller blast occurred in a two-inch stainless steel pipe leading from Building #3 to the wet well. The second, larger blast occurred below grade in the southwest quadrant of the wet well. Wastewater from all operations was collected and neutralized in the wet well.

Lomac facilities sustained substantial damage from the second blast and the high-energy fragments, including: destruction of the wet well, destruction of nearby Building #9, destruction of the Weld Shop, and serious damage to Building #3. It’s estimated the magnitude of the second blast was equivalent to 250 pounds of TNT.

MIOSHA Investigation/Citations

The complex, nine-month investigation was conducted by a team of health and safety officers from the Occupational Health, General Industry Safety, and Construction Safety Divisions of the CIS Bureau of Safety & Regulation, which is responsible for the MIOSHA program. MIOSHA also retained an expert in process safety management to assist in the investigation. MIOSHA investigations focus on identifying violations of state worker safety and health standards at the time of the accident, and do not determine the cause of the accident.

The MIOSHA team found a significant number of workplace safety and health violations, particularly in the area of process safety management. Under MIOSHA rules, manufacturers have strict responsibilities concerning the use of hazardous chemicals. MIOSHA’s Process Safety Management of Highly Hazardous Chemicals (PSM) of 1993 establishes requirements to prevent, or minimize, the potential for fire or explosion in manufacturing processes where hazardous chemicals are involved.

Lomac was made aware of the PSM standard in 1993 during a MIOSHA compliance inspection, and has a history of PSM violations. Since the standard went into effect in 1993, the company has had 19 incidents related to PSM.

As a result of the 1993 inspection, Lomac developed a "Process Safety Management Plan" which contains procedures for operating processes covered by the PSM standard. Each section in the plan describes activities for managing process hazards in a particular area. However, Lomac did not consistently follow the requirements developed in their own plan.

"I believe the April 12^th explosion was a true ‘wake-up call’ for Lomac," Wilbur said. "This comprehensive agreement provides an opportunity for the company to make lasting improvements in worker and community safety and health protections."

CIS issued 15 unclassified violations of the following standards: Flammable and Combustible Liquids, Process Safety Management of Highly Hazardous Chemicals, and Electrical Safety-Related Work Practices. The violations include a $150,000 penalty, and all conditions have been abated.

Settlement Agreement

The Settlement Agreement details significant activities that Lomac must accomplish within specified time frames, to improve the overall safety of their operations. The company has committed to: a full assessment of worker safety and health in all areas; significantly improved training for employees, especially in the area of process safety management; and inclusion of workplace safety into every aspect of corporate management. The agreement also provides for monitoring of the company’s progress by MIOSHA.

Compliance with this agreement will bring many benefits to the community, above and beyond the advantages received by employees. Components of the EPA (U. S. Environmental Protection Agency) Risk Management Program are very similar to the components of MIOSHA’s PSM standard. Several of the elements of this agreement are specific to the surrounding community, which will also benefit from Lomac’s compliance with the PSM standard.

Read more Michigan Department of Consumer & Industry Services press releases.