A California company that operated a natural gas storage system that leaked last year, seeping thousands of tons of methane and other chemicals into the air and forcing the evacuation of more than 6,000 people, reached a $4 million settlement with state prosecutors, officials said.
The company, Southern California Gas Company, pleaded no contest to a misdemeanor of failing to immediately report the Oct. 23, 2015, gas leak to the California Office of Emergency Services and to the local Certified Unified Program Agency.
As part of the plea, the company must pay $307,500 in fines and penalties, said Los Angeles County district attorney, Jackie Lacey.
The company must also install and maintain an infrared methane monitoring system at the site in Aliso Canyon that will cost up to $1.5 million. Other provisions call for pressure monitors at each gas well, an outside company to test and certify the systems, and the hiring of six full-time employees to operate and maintain the new leak detection systems around the clock.
Cost for these positions will be $2.25 million for the next three years, according to the prosecutor’s office. The company will also pay $246,672 for the cost of the investigation and emergency response by the Los Angeles County Fire Department’s Health and Hazardous Materials Division.
Terms of the settlement must end up completed by a Nov. 29 sentencing date. The agreement will not interfere with pending civil suits against the company, Lacey said.
The prosecutor’s office said with the conviction, the company could face more serious criminal penalties in the future “if the same unlawful conduct occurs.”
Southern California Gas Company said in a statement the agreement was “another important step in our efforts to put the leak behind us and to win back the trust of the community.”
The agreement stems from a natural gas leak engineers believed was the result of a rupture 500 feet below the surface. Residents who returned after the evacuation continued to complain of being sick from the odors even after the company declared the leak capped in February.
The rupture led to state reforms about the regulation of the Aliso Canyon storage site specifically and the introduction of legislation about the placement of natural gas wells statewide.