Columbia Gas of Massachusetts has agreed to accept responsibility for the gas explosions on Sept. 13, 2018, in Lawrence, Andover and North Andover that killed one individual, injured 22, and damaged homes and businesses.
According to the terms of a plea agreement with the government, Columbia Gas of Massachusetts (CMA) will pay a criminal fine of $53 million, which prosecutors said represents twice the amount of profits that CMA earned between 2015 and 2018 from a pipeline infrastructure program.
The parent company, NiSource, has also agreed to sell CMA and give up any profit from the sale.
“We’re here because this investigation found that Columbia Gas, through a pattern of flagrant indifference in the face of extreme risk to the life and property, knowingly violated minimum safety standards,” said U.S. Attorney Andrew Lelling at a press conference announcing the settlement.
“This disaster was caused by wholesale management failure at Columbia Gas.”
Bay State Gas Co., which does business as CMA, has agreed to plead guilty to violating a minimum safety standard of the federal Natural Gas Pipeline Safety Act for failure to implement procedures to prevent the over-pressurization of its low-pressure gas distribution system in South Lawrence during a pipe replacement project known as the South Union Project.
In addition to a fine, CMA’s operations will be subject to monitoring during a three year period to ensure Columbia’s compliance with federal and state safety regulations.
The U.S. Attorney’s office said it has also entered into a Deferred Prosecution Agreement (DPA) with CMA’s parent company, NiSource, based in Indiana. As part of the DPA, NiSource has agreed to undertake its “best reasonable best efforts” to sell CMA, after which NiSource and CMA would stop all gas pipeline operations in Massachusetts.
In exchange for the government’s agreement to defer prosecution of NiSource as a result of CMA’s conduct, NiSource has also agreed to forfeit any profit it may earn from the sale of CMA and implement each of the safety recommendations from the National Transportation Safety Board resulting from the Sept. 13, 2018 incident.
CMA said in a statement that it would take “full responsibility” for the September 13, 2018 tragedy that affected its customers throughout the Merrimack Valley.
According the U.S. attorney’s charging documents, during the afternoon of Sept. 13, 2018, the over-pressurization of a low pressure gas distribution system in South Lawrence caused multiple fires and explosions in the communities of Lawrence, Andover, and North Andover. As a result, one individual in Lawrence was killed and another severely disabled, 22 people were injured, and approximately 131 residential homes and commercial buildings were damaged.