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PG&E Expects Criminal Charges in Fatal 2010 California Blast

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Such criminal charges for a pipeline are not unprecedented.

Gasoline system operator Olympic Pipe Line and two of its employees faced criminal charges after a June 2009 incident in which gasoline that leaked from its system into a river in Bellingham, Wash., ignited and killed three boys fishing nearby.

The company’s pipeline manager served six months in prison; a control room supervisor served one month.

PG&E is already facing a potential $2.25 billion fine for safety violations related to San Bruno proposed by California safety regulators—the largest fine ever proposedfor a pipeline operator, in a case being closely watched by the gas industry.

One observer noted that natural gas safety has been under the microscope lately, particularly after a New York City explosion killed eight people earlier this month and is suspected to have been caused by gas leaking from a nearby main.

That was preceded by such incidents as a gas explosion that leveled several townhomes and killed one person in New Jersey in early March, and a 2011 explosion in Allentown, Pa. that killed five people after gas leaked from an 83-year-old cast iron main.

PG&E said in its 8-K filing that “it believes that criminal charges are not merited and that PG&E employees did not intentionally violate the federal Pipeline Safety Act."

It said that even where mistakes were made, employees were acting in good faith to provide customers with safe, reliable, affordable, clean energy.”

PG&E said it would “maintain its strong focus on safety during what is expected to be a lengthy legal process.”

In a statement, PG&E Chairman and CEO Tony Earley, who was brought in to lead the company in 2011 after the San Bruno accident, said: "We've implemented enormous change here at PG&E," whose natural gas system is more than 100 years old.

"In support of this, we've committed $2.7 billion of shareholders' money to date and we're making excellent operational progress," he said.

According to the company, it has settled more than $500 million in claims and replaced 127 miles of pipeline, among other steps outlined in its statement.

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