TOULOUSE - The prosecution said on Friday it would appeal a French court's decision to drop charges against a subsidiary of oil major Total over a 2001 chemical blast that killed 31 people.

The appeal means the subsidiary, which owned the AZF chemical fertiliser plant where the explosion occurred, and the plant's director will be retried.

A court in the southern French city of Toulouse dismissed the charges on Thursday.

The explosion at the factory in an industrial zone on the outskirts of Toulouse happened less than two weeks after the Sept. 11, 2001 attacks on the United States and initially sparked suspicions of a terrorist bombing.

The judges found there was no proof of a deliberate attack and an accident was the most likely cause of the blast which damaged about 30,000 homes and hundreds of businesses in a radius of up to 6 kilometres (4 miles).

The subsidiary, Grande Paroisse, and AZF director Serge Biechelin had been charged with involuntary homicide, causing injury and destruction of property but the court said it was impossible to reach a verdict against them with certainty.

Plaintiffs had argued the explosion was caused by a problem of stocking volatile ammonium nitrate and accused the plant's management of negligence.

The company has paid some 2 billion euros ($2.6 billion) in compensation but said this did not constitute an acknowledgement of any criminal responsibility. (Reporting by Nicolas Fichot; Writing by Anna Willard)

Explosion