The US Occupational Safety and Health Administration (OSHA) said the penalty "rightly reflects BP's disregard for workplace safety". BP said it had worked to enhance safety at the plant.

OSHA is still working to collect another $30million from the company for other penalties that BP is contesting.

The fine is the largest handed out by OSHA, which is part of the Labour Department.

"This agreement achieves our goal of protecting workers at the refinery and ensuring that critical safety upgrades are made as quickly as possible," said Secretary of Labour Hilda Solis.

BP also agreed to spend $500million on fixing safety problems at the refinery.

"We respect OSHA's concerns and have addressed them in this agreement," said Iain Conn, BP's global head of refining.