Pipeline operator agrees to $50M California spill settlement

A pipeline operator has agreed to pay $50 million to thousands of Southern California fishermen, tourism companies and property owners who sued after an offshore oil spill last year near Huntington Beach.

A proposed settlement between Amplify Energy Corp., which owns the pipeline that ruptured, and the businesses and residents was filed Monday in federal court in Santa Ana, court documents show.

Under the proposal, the Houston-based energy company would pay $34 million to commercial fishermen and $9 million to coastal property owners. It also would pay $7 million to waterfront tourism operators, including businesses that provide surf lessons and leisure cruises and shops that sell swimwear and fishing bait.

A federal judge still needs to sign off on the proposal for it to take effect. A hearing is scheduled for Nov. 16.

“This is a really dramatic first step and a dramatic compensation for these victims of this terrible tragedy,” said Wylie Aitken, co-lead counsel for the plaintiffs, whom he estimated number more than 10,000. “Though it may not be 100% it is very substantial and very helpful and a good deal of compensation to them. We're going to continue to try to get every last penny that they deserve.”

A message seeking comment was sent Tuesday to Amplify.

The agreement, which was initially reached in August, requires Amplify to install a leak detection system and provide spill training to employees, steps that the company also agreed to in a plea deal with federal authorities. It also would require Amplify to increase staffing on an offshore oil platform, court papers show.

The October 2021 pipeline leak spilled about 25,000 gallons (94,600 liters) of oil into the Pacific Ocean. While less severe than initially feared, the spill shuttered beaches in surf-friendly Huntington Beach and nearby communities for a week and fisheries for more than a month and oiled birds and threatened area wetlands.

Earlier this year, Amplify reached a plea deal with federal authorities for negligently discharging crude off the coast. The company, which authorities said failed to respond to leak detection system alarms that should have alerted workers to the spill, also agreed to pay a combined $13 million in fines and expenses incurred by agencies such as the U.S. Coast Guard.

Amplify contends that two commercial shipping vessels damaged its pipeline when they dragged their anchors across it during a January 2021 storm. The proposed settlement doesn't apply to the operators of those ships or to an organization that helps oversee marine traffic, which has also been brought into the litigation.