On the third anniversary of the Sept. 9, 2010 San Bruno natural gas transmission pipeline rupture and explosion pipeline owner/operator Pacific Gas and Electric Co. (PG&E) said it has settled substantially all of the legal claims that resulted from the blast.
The combination utility said it would take a charge of about $110 million against third quarter earnings as a result of the settlement. In a filing to the Securities and Exchange Commission (SEC), PG&E and parent PG&E Corp. said the utility has agreed to settle “substantially all of the remaining plaintiff claims” that were seeking compensation for personal injury and property damage and other relief, including punitive damages. Earlier, the San Francisco-based utility disclosed that 160 lawsuits on behalf of about 500 plaintiffs had been filed against PG&E.
Late last year, PG&E said it was hopeful of this eventual settlement, although at the time a California Superior Court judge’s pretrial decision allowed punitive damages to be consolidated and added into the many civil legal cases (see Daily GPI, Nov. 5, 2012). Also at that time, PG&E senior executives said the utility and its holding company ultimately would pay between $1 billion and $2 billion in settlements, while estimates on third-party liability claims could amount to another $600 million.
In the SEC filing, PG&E said as of the end of June, it had recorded cumulative charges of $455 million for third-party claims covering personal injury, property damage and damage to infrastructure related to the explosion. It said that as of that time period it had make cumulative payments of $388 million related to those claims.
Earlier last year, PG&E and the City of San Bruno settled their differences with the utility agreeing to pay the city $70 million (see Daily GPI, March 13, 2012). The deal was labeled as restitution to support San Bruno’s efforts to recover and heal following the blast. The $70 million is in addition to PG&E’s commitment to fund replacement and repair of the city’s infrastructure and other costs related to the explosion and restoration of the impacted neighborhood.
In the latest SEC filing, the utility also estimated that as of June 30 it was reasonably possible it would incur as much as an additional $145 million for unresolved claims, for a total possible loss of $600 million, higher than the cumulative $400-500 million estimate made last year by PG&E Corp. CEO Anthony Earley.
During the quarter ended Sept. 30, PG&E expects to record a charge of about $110 million in addition to the cumulative charges of $455 million to reflect the settlements reached last Friday and Monday, the SEC filing said. This includes what the utility said was the “estimated liability for remaining third-party claims for personal injury, property damage, and damage to infrastructure, including claims by government entities.”
© 2021 Natural Gas Intelligence. All rights reserved.
ISSN © 1532-1231 | ISSN © 2577-9877 |