Spectra expects to pay $100 million after pipeline blast

The company operating an interstate gas transmission line that exploded last spring outside Pittsburgh expects to pay between $75 to $100 million to inspect and repair its pipeline system.
The April 29 incident in Westmoreland County happened on the Texas Eastern pipeline, operated by Spectra Energy. The explosion blew a 12-foot-deep, 1500-square-foot hole and scorched 40 acres. It sent a man to the hospital with severe burns and disrupted natural gas service to the northeastern U.S.
In an earnings call Wednesday, Spectra’s Chief Financial Officer & Vice President John Patrick Reddy said the company is working closely with the Pipeline and Hazardous Materials Safety Administration (PHMSA) to take corrective actions.
“In total, we expect to incur special item cost in the range of $75 million to $100 million related to these activities,” Reddy told investors. “Importantly, we expect that by November 1, we’ll be in a position to fully meet our customer obligations for the winter season.”
Last month PHMSA ordered Spectra to conduct more testing in the area of the ruptured line, saying three nearby lines buried underground “could potentially have been damaged or adversely affected by the explosion …  and pose a serious risk to life, property, or the environment if returned to normal operation.”
“We intend to be methodical in our evaluation and take the time we need to do a thorough assessment,” says Spectra spokesman Creighton Welch. “We have begun or completed many of the action items in the amended corrective action order.”

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