Biggest U.S. Gas Leak Followed Years of Problems, State Says

(Bloomberg) -- The worst natural gas leak in U.S. history, which broke out at a Sempra Energy storage field near Los Angeles almost four years ago, was caused by corrosion, according to a report commissioned by California regulators.

The rupture of a 7-inch (18-centimeter) well casing at Sempra Energy’s Aliso Canyon storage complex was due to “microbial corrosion” brought on by contact with groundwater, an independent analysis conducted by Blade Energy Partners and commissioned by two state agencies found.

The report also concluded there had been more than 60 leaks in the field dating back to the 1970s, and Sempra didn’t carry out detailed inspections after they occurred, the California Public Utilities Commission and Department of Conservation said in a joint statement. The company’s Southern California Gas lacked “any form of risk assessment” to manage the integrity of its wells and hadn’t established systematic practices to protect against corrosion and monitor well pressure, the agencies said.

Sempra has already reported more than $1 billion in costs associated with the October 2015 leak that forced thousands of residents to evacuate the area for months as the gas dissipated. California estimated that the ruptured well spewed the equivalent of a year’s worth of greenhouse-gas emissions from more than 500,000 cars. Regulators have restricted use of the field since the blowout, tightening fuel supplies in Southern California and contributing to frequent power and gas price spikes.

SoCalGas said it was still reviewing the report but that it shows the utility complied with gas storage regulations that existed at the time of the leak.

“In Blade’s opinion, there were measures, though not required by the gas storage regulations at the time, that could have been taken to aid in the early identification of corrosion and that, in their opinion, would have prevented or mitigated the leak,” the company said in a statement.

Blade also found that the flow of gas from the ruptured well had been underestimated, resulting in several failed attempts to kill it by pumping fluids. A higher pump rate would’ve successfully contained the well as early as Nov. 13, 2015, the report showed. The release instead went uncontrolled for 111 days.

Casing failures

The report found that 40% of the 124 storage wells analyzed at the site had casing failures -- with an average of two failures per well. Its report showed there were at least two prior underground blowouts that were killed at the site.

“If I were Sempra, I wouldn’t be happy with this report,” said R. Rex Parris, a lawyer representing residents who sued Southern California Gas following the gas leak. “This supports our claims of reckless and gross negligence which will get us to punitive damages.”

Parris said the group hadn’t previously realized “the extent to which they had underestimated the flow of gas.”

State regulators have established new requirements, including real-time pressure monitoring, testing and well construction requirements, to prevent a similar leak from happening again.

©2019 Bloomberg L.P.