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UPDATE: SoCalGas reaches $119.5M government settlement for Aliso Canyon leak


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UPDATE: SoCalGas reaches $119.5M government settlement for Aliso Canyon leak

Sempra Energy utility Southern California Gas Co. reached a $119.5 million settlement with state and local government bodies in California over the leak at the Aliso Canyon gas storage facility.

The settlement will reimburse government agencies for costs associated with the leak, establish programs to mitigate emissions from the event and fund local initiatives for environmental benefit. The deal will "help California meet its ambitious climate goals by advancing projects that capture methane from dairy farms and waste and convert that energy into renewable natural gas for use in transportation," SoCalGas President and COO Bret Lane said in an Aug. 8 statement. The agreement was reached between the utility and the Los Angeles city attorney, the County of Los Angeles, the California attorney general and the California Air Resources Board.

"We were able to secure a settlement that works in the public's interest," California Attorney General Xavier Becerra said in a news conference Aug. 8.

Still, he acknowledged legal components beyond the settlement with SoCalGas and Sempra that remain unresolved. "This is not an action to address the personal harm or injury or damages suffered by individuals. That is litigation that's pending," Becerra said. "This was not an action to determine liability or the cause of this. That is being done by the California Public Utilities Commission."

Becerra added that under the agreement, SoCalGas cannot shift the costs of the settlement to ratepayers.

The facility had been under strict restriction since a massive leak discovered in late 2015. State regulators allowed the company to increase storage at Aliso Canyon in early July to a maximum of 34 Bcf, up from the state's previous 24.6-Bcf limit on the field. Aliso Canyon had a historical capacity limit of about 86 Bcf.

SoCalGas said it will continue a so-called fence line methane monitoring program at the site and hire an independent ombudsman to monitor it. "That way, we have current information year-to-year ... so we can see if there's a need to trigger action," Becerra said. The settlement also includes $25 million for a comprehensive health study to look at the long-term impacts of exposure to methane, to be administered by local, state and federal agencies.