Natural Gas Pipeline Explosion Lawsuits Settled by PG&E for $565M

As a result of a deadly natural gas pipeline explosion three years ago in San Bruno, Califoria’s Pacific Gas and Electric (PG&E) has agreed to pay more than half a billion to settle property damage, personal injury and wrongful death lawsuits.  

In September 2010, a 30-inch pipeline exploded in San Bruno, California and killed eight people, injured dozens more and destroyed 38 homes, virtually obliterating the Crestmoor neighborhood.

Earlier this week it was announced that PG&E has paid about $565 million in settlements to resolve nearly all of the explosion lawsuits filed by victims.

At least 499 individuals presented claims and the money has been divided among the plaintiffs, including families who lost loved ones and people who were injured in the blast or suffered property damage. The exact amount will vary from one plaintiff to the next, depending on the damages suffered.

At this time, only two lawsuits over the natural gas pipeline explosion remain unsettled out of the 160 complaints filed since the blast.

The money for the settlements is covered in part by the company’s insurance, but will also come from shareholders, which PG&E officials say means that taxpayers will not bear the cost of the lawsuits. In March 2012, the company reached a $70 million settlement with the city of San Bruno over the blast.

The company also faces additional fines of potentially $2.25 billion over the explosion. The fine was recommended by the California Public Utilities Commission, which should make a final determination on the fine by the end of the year. Prosecutors are also investigating whether executives should be charged in the blast.

An investigation into the blast has revealed that a defective section of pipe has been installed at the site since 1956, that PG&E had poor record keeping practices and a culture that failed to emphasize safety; all of which were determined to be contributing factors to the blast.

There have been more than 3,000 gas pipeline accidents over the last two decades as the nation’s infrastructure system continues to age. A third of those have resulted in major injuries or death, according to federal officials. The San Bruno explosion, which was caught on camera phones and security cameras, has sparked concern among federal and municipal officials as to the condition of gas pipelines across the country.