ARCO chemical Co. has agreed to pay a record $3.5 million fine for worker safety violations relating to last year's explosion at a Texas plant that killed 17 workers, the government said Thursday.

ARCO's agreement to pay the fine and overhaul workplace safety programs at its plants nationwide came as the Occupational Safety and Health Administration issued the fine and cited the company for violations stemming from the explosion.OSHA proposed a $3.48 million penalty for nearly 350 instances of "willful" violations of federal safety laws.

ARCO agreed to pay the full amount rather than trying to settle for less. It sets a new record for the largest amount ever collected by OSHA.

Seventeen chemical workers were killed and five others were injured last July 5 at an ARCO plant in Channelview, Texas, a Houston suburb, when a wastewater tank exploded.