Huge gas leak leads to $120 million settlement
LOS ANGELES — A Southern California utility reached a nearly $120 million settlement over a massive blowout at a natural gas storage field that became the nation's largest known release of climate-changing methane and forced thousands to flee their Los Angeles homes almost three years ago, officials announced Wednesday.
The settlement between Southern California Gas Co. and state and local governments aims to mitigate the greenhouse gases that spewed uncontrollably for nearly four months. The October 2015 blowout at an Aliso Canyon well sickened residents of the San Fernando Valley and led to evacuations of 8,000 homes.
Under the settlement, the utility agreed to pay up to $25 million for a study of long-term health consequences; reimburse city, county and state governments for responding to the blowout; monitor chemicals in the air along the boundary of the facility for eight years; and not pass costs of the settlement along to ratepayers.
"This settlement says that they have to eat all the costs," said City Councilman Mitchell Englander, who lives in the area. "During the blowout, their stock price actually went up. That was insane, and it was insulting, and I know the people that were liv- ing there were very upset about that, and they wanted it to come out of their pocket."
Attorney General Xavier Becerra said the tentative deal, which will be open to public comment and requires court approval, addressed violations of health and safety codes, the illegal discharge of air contaminants and failure to report the release of hazardous materials.
"There is no excuse for what happened," Becerra said in a statement. "For over four months, this leak exposed our communities to natural gas emissions that resulted in adverse health impacts and disrupted the lives of tens of thousands of Californians."
In a previous settlement of criminal charges, the utility agreed to a $4 mil- lion settlement with Los Angeles prosecutors after pleading no contest to a single misdemeanor of failing to notify state authorities about the blowout soon enough.
The company, which is a subsidiary of Sempra Energy, has spent over $1 billion because of the blowout, according to a quarterly report released Monday. The majority was spent relocating families for months and reimbursing them for meals and other costs and cleaning homes. The remaining costs include legal expenses, paying for a study of the blowout's cause, efforts to cap the well, and the cost of lost gas.