AK SUPREME COURT RULES AGAINST
FOR SAFETY VIOLATIONS
The Alaska Supreme Court on April 7 upheld the
Occupational Safety and Health Review Board's decision that Halliburton Energy Services
Company violated Occupational Safety and Health Administration (OSHA) standards regarding
the manufacture of explosive devices at its Kenai plant. The Court ruled that Halliburton
had to comply with process safety management (PSM) regulations when it assembled
perforation guns that are later used to perforate oil well casings. The Court asserted
that a large and sophisticated company involved in hazardous activity bears a substantial
burden of inquiry concerning the understanding of OSHA standards.
"Establishing what is and what is not considered the manufacturing of explosives is
an important decision and could have national ramifications," said Commissioner of
Labor and Workforce Development (Labor) Ed Flanagan. "This decision effectively
serves notice that oil field service companies must evaluate their compliance with PSM
standards, establish detailed procedures for handling explosives, and address training for
each individual employee's involvement with explosive materials."
The decision brings to a close a case that began in April 1994 when an explosion at
Halliburton's Kenai plant killed a 22-year old part-time employee. Kenai resident Craig
Bowen was assembling perforation guns when he accidentally triggered the fatal explosion,
killing himself and seriously injuring four other workers.
OSHA regulations require that manufacturers of explosives or explosive devices comply with
PSM standards. Labor's Division of Occupational Safety and Health concluded that
Halliburton did not have proper safety measures in place when the explosion occurred and
subsequently cited the company for failure to meet PSM standards. Halliburton contested
the violations and argued to the board for dismissal asserting that when it assembled
perforation guns it was not manufacturing explosive devices. Halliburton also contended
that it was exempt from having to comply with PSM because it was an oil well servicing
company and oil well servicing operations are exempt. The board disagreed. The case
eventually reached the Supreme Court that ruled Halliburton was not performing oil well
servicing operations when it manufactured the explosive device--a perforation gun.
"From a workers' safety standpoint, this decision has already had a positive impact
on the industry," Flanagan said. "But it is tragic that it took the death of a
young man, and the serious injuries of four others, to bring needed change."