Sep 28, 2021 - Energy & Environment

SoCalGas agrees to $1.8 billion settlement for 2015 gas blowout

An evacuee with Save Porter Ranch holds a sign to "shut it all down" outside Southern California Gas Company's Aliso Canyon gate in Porter Ranch over the continuing gas leak in 2016

An evacuee with a Save Porter Ranch sign outside Southern California Gas Company's Aliso Canyon gate in Porter Ranch in January 2016 as the gas leak continued. Photos: Al Seib / Los Angeles Times via Getty Images

Southern California Gas and its parent company announced Monday they've agreed to pay up to $1.8 billion in settlement claims over the 2015 Aliso Canyon natural gas storage facility blowout.

Why it matters: Some 100,000 tons of methane, ethane and toxic chemicals poured into the air for 112 days, forcing over 8,000 families to evacuate from their Los Angeles-area homes and sickening many with headaches, nausea and nosebleeds, per the L.A. Times.

  • It was the biggest natural gas leak recorded in the U.S. at the time and the payout would affect about 36,000 plaintiffs, settling years of legal action.

The big picture: SoCalGas and its parent company, Sempra, have denied wrongdoing for the blowout, which has seen the utility spend more than $1 billion in having to temporarily relocate affected families, as it faced over 385 lawsuits on behalf of 48,000 people, AP notes.

  • The company has previously reached a $120 million settlement with California's attorney general, plus $4 million with Los Angeles County prosecutors after a Los Angeles County court convicted SoCalGas for "failing to quickly report the leak to state authorities," the Washington Post notes.
  • SoCalGas will record an after-tax charge of roughly $1.1 billion this month, but settlement costs wouldn't be borne by ratepayers, per a company statement on the agreements with the families.

Yes, but: The settlement for the blowout near Porter Ranch in San Fernando Valley is dependent on roughly 97% of plaintiffs accepting the payout, which could be reduced if this is not reached or it could end up back in court.

What they're saying: SoCalGas CEO Scott Drury said in a statement that the agreements "are an important milestone that will help the community and our company work toward putting this difficult chapter behind us."

  • Matt Pakucko, founder of Save Porter Ranch, in a statement renewed calls to permanently close the facility, saying: "You can't put a price tag on human suffering."
  • "SoCalGas' devastating blowout will never be behind us until the Aliso Canyon storage facility is shut down and the danger it poses to the community is permanently eliminated," Pakucko said. "We are nowhere near a resolution."
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