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SG Solutions Cited for Safety Violations

July 26, 2008

By Sue Loughlin, The Tribune-Star, Terre Haute, Ind.

Jul. 26–A coal gasification plant north of Terre Haute faces a potential $27,000 in fines for serious safety violations in connection with an April 28 explosion that killed two people, according to the Indiana Occupational Safety and Health Administration.

The accident, which occurred at SG Solutions at 444 W. Sandford Ave., was attributed to a faulty flange that resulted in synthetic gas exploding. Two workers, Danny Turner of Marshall, Ill., and David Shoemaker of Rosedale, were killed.

Earlier this week, IOSHA sent a safety order and notification of penalty to SG Solutions, said Sean Keefer, Indiana Department of Labor spokesman. The order listed serious safety violations that were found during inspections.

Some of the violations relate to safety information and written operating procedures.

“Some deal with not having written programs or processes in place so individuals have a clear understanding of what they are supposed to be doing to have a safe work environment,” Keefer said.

The company was cited for the following “serious” violations:

n It did not have a written program that contained the safe operating limits for the coal gasification process, including but not limited to, the safe operating temperatures and pressures for the E-150 heat exchanger.

n It did not have a written operating procedure that contained the safe upper and lower limits and consequence of deviation for the coal gasification process, including, but not limited to, the safe operating temperatures and pressures for the E-150 heat exchanger.

n [Heat exchanger, E-150] Its process hazard analysis of the coal gasification process did not include all the hazards such as, but not limited to, breaks in the refactory materials, hot gas flowing past refractory plug, effect of heat on manway fasteners and effect of fire from leaking flanges.

n [Heat exchanger, E-150] Manway and manway components, including studs and nuts, were not maintained in accordance with manufacturer guidance or recognized and generally accepted good engineering practices.

n [E-150] SG Solutions did not perform an incident investigation on a leak “that pegged out the meter from one foot from the fourth deck manway” on Nov. 10, 2007. The OSHA standard violated states that “the employer did not investigate each incident which resulted in, or could reasonably have resulted in, a catastrophic release of a highly hazardous chemical in the work place.”

n SG Solutions did not perform a process safety management compliance audit in accordance with federal OSHA standards.

Keefer said the $27,000 “is a lot of money,” particularly when factoring in “the totality of losses” a company faces when it has a serious accident with fatalities.

If a company disagrees with the findings and fines, it can request an informal conference or an administrative review, Keefer said. SG Solutions has 15 working days to contest the safety order and proposed penalty.

The two men who died were employees of Sterling Boiler and Mechanical Inc., an Evansville-based firm founded in 1982 to help utility companies with emergency repairs, fabrication and construction projects.

Turner and Shoemaker, members of Boilermakers Local 374, were working about 150 feet in the air on the eighth deck of a coal gasifier, which is used in the process of turning coal into gas. The men were tightening bolts on the flanged opening, similar to a manhole cover, when the flange failed, causing an explosion, Richard Payonk, plant manager, said in April after the accident.

Payonk could not be reached for comment Friday afternoon.

“Our process runs at 400 pounds of pressure producing a synthetic gas, and consequently, when that flanged opening failed, it did release the contents of the gasification facility,” Payonk said in April. “At 400 pounds of pressure, that is a fairly violent release.”

SG Solutions, including contractors, employed about 80 people at its facility in April. It is located just east of Indiana 63, about six miles north of Terre Haute.

Wabash Valley Power owns 50 percent of SG Solutions, which transforms petroleum coke into synthetic natural gas, which is then burned to generate electricity. The company last year bought one unit of the Wabash River Power Station from Duke Energy.

Wabash Valley Power is a generation and transmission cooperative based in Indianapolis that provides wholesale electricity to 28 electric distribution cooperatives in Indiana, Illinois, Michigan, Missouri and Ohio.

A representative of Wabash Valley Power could not be reached for comment Friday.

Sue Loughlin can be reached at (812) 231-4235 or sue.loughlin@tribstar.com.

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Copyright (c) 2008, The Tribune-Star, Terre Haute, Ind.

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