Three years after Southern California Gas Company sealed a massive natural gas leak at its storage field near Porter Ranch, a judge has approved a legal settlement stemming from the disaster.
The settlement will cost SoCal Gas $120 million, but it disappointed some environmental groups who said it didn't do enough to address the damage the gas leak caused to residents living nearest the gas well.
The well ruptured in October 2015, and blew methane gas and other substances for four months, becoming the nation's largest-ever uncontrolled gas leak.
California's Attorney General and the city and county of Los Angeles agreed to drop their lawsuits against SoCal Gas as part of the $120 million settlement.
The settlement was meant to fulfill an emergency order issued by then-Gov. Jerry Brown at the height of the blowout. He ordered SoCal Gas to fully offset the harmful greenhouse gases that went into the atmosphere.
The agreement provides $26.5 million dollars for projects to offset 109,000 metric tons of methane released by the ruptured gas well.
To do that, the money will be used to capture methane being produced in large amounts - by cows.
Loans will be funded to to build systems at big dairies in Kern County that will capture methane from cow manure and convert it to usable natural gas. The project will also fund construction of pipelines to move the gas from the dairy farms into the natural gas distribution system where it can be sold.
SoCal Gas would not own the gas produced in the methane capture projects or earn income from the sale, state Air Resources Board spokesman Dave Clegern said.
Once the proceeds of gas sales repays the loans with interest, the money will be available to fund methane capture projects in Los Angeles city and county.
Byron Chan, an attorney with EarthJustice, a legal organization that represents environmental groups, said the settlement did not require SoCal Gas to pay the full cost of the methane capture projects.
"It's not holding them fully accountable for the entire mitigation," Chan said.
The California Air Resources Board says the settlement does require SoCal Gas to pay to offset all the methane it released into the atmosphere via the dairy methane digester projects. The money will do double-duty, first to fund the dairy gas projects and later to be used closer to communities that were harmed by the gas release, said Dave Clegern, ARB spokesman.
The settlement cost comes out of the company's profits, not ratepayers. The company still faces about 350 lawsuits and 48,000 plaintiffs who sued the company over the gas leak.
Getting the methane mitigation projects in place as soon as possible is critical, Clegern said. That is because methane is a powerful greenhouse gas that does its worst damage in the atmosphere in the first decade after it is released.
A group of Porter Ranch residents called the Aliso Canyon Community Action Committee also came out against the settlement because it directs the methane mitigation money to dairy farms in the San Joaquin Valley, not to projects in Los Angeles city or county where affected families live.
The settlement also pays the state and local governments' legal costs and provides $25 million for a long-term health study of Porter Ranch residents who live close to the Aliso Canyon gas storage field. Some 8,000 households relocated away from neighborhoods near the gas leak, many complaining about headaches, nosebleeds, and other symptoms.
