Ahead of a California Superior Court hearing Friday, Pacific Gas and Electric Co. (PG&E) on Tuesday publicly said it was liable for the natural gas transmission pipeline explosion last year and will compensate all of the victims of an incident that has rocked the North America pipeline sector.

PG&E said it made this statement as part of a news release in response to a San Mateo County judge’s request for PG&E’s official position and comes ahead of Friday’s court hearing to discuss various issues regarding the case. The San Francisco-based combination utility said it is taking on financial responsibility to compensate all of the victims for the injuries they suffered as a result of the Sept. 9, 2010 accident.

In making its formal announcement, PG&E said it wanted to “make clear” that none of the plaintiffs, San Bruno residents or the city itself is at fault. “We would never consider holding the residents accountable for this accident,” said utility President Christopher Johns. “Since the accident, PG&E has stood by the community of San Bruno, and we will bear the cost to make things right for the city and its people.”

Johns said PG&E has been working for the past 14 months with those impacted by the accident. Its goal has been to resolve all claims fairly and promptly, he said. “The utility remains committed to helping the city of San Bruno and the victims of the accident and their families recover and rebuild.”

At the beginning of this year PG&E reported taking an initial one-time charge against earnings of $283 million to cover the initial added costs of the San Bruno incident, but added that it was projecting up to $760 million in costs, including some $400 of potential third-party liability costs, related to the San Bruno incident by the end of this year (see Daily GPI, Feb. 18). At that time, the utility’s senior management said the bulk of the liability costs were expected to be covered by the $992 million of insurance coverage PG&E has in place.

With its public acknowledgement Tuesday, PG&E also released a letter sent by Johns to utility employees, emphasizing the need “to take accountability” not only for the tragic pipeline failure but for the cleanup and restoration, the healing and the financial responsibility for the rebuilding. He told employees the utility took another important step by accepting the liability.

“As we’ve said all along, our pledge is to do the right thing in every area of our response to this tragedy,” Johns said. “The [Superior Court] judge presiding over [the utility’s] cases asked PG&E to provide our official position. The judge is hopeful that this will make the legal proceedings move faster and more efficiently. PG&E is hopeful that this will allow the people injured to receive compensation sooner without unnecessary legal proceedings.”

In the same letter, Johns also said PG&E still faces a long process in “turning around” its natural gas business. Legal claims against the giant utility “are far from over,” but he pledged to customers that as the company moves forward it will do so with what he called “integrity and accountability.”

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