By Kyra Buckley STAFF WRITER
Houston-based Amplify Energy said Friday it will plead guilty to one count of misdemeanor negligent discharge of oil related to October’s pipeline leak that spewed 25,000 gallons of oil into waters off the coast of Southern California.
Amplify will pay a fine of about $7 million over three years and reimburse almost $6 million to government agencies, pending court approval of the agreement.
In December, Amplify and two of its subsidiaries were charged by a federal grand jury with a misdemeanor count of illegally dumping oil. Prosecutors say the company failed to respond to eight leak detection alarms in a 13-hour period, while the company said crews believed the detection system wasn’t operating properly.
As part of the proposed agreement, the company will also install a new leak detection system.
“The substantial financial penalties and compliance measures required by the plea agreements demonstrate the federal government’s resolve to punish any entity that causes environmental damage,” acting U.S. Attorney Stephanie S. Christensen said in a statement. “This oil spill affected numerous people, businesses and organizations who use the Southern California coastal waters. The companies involved are now accepting their responsibility for criminal conduct and are required to make significant improvements that will help prevent future oil spills.”
Amplify CEO Martyn Willsher said the company has been working with the investigating agencies since the incident.
“We believe this resolution, which is subject to court review and approval, reflects the commitments we made immediately following the incident to impacted parties and is in the best interest of Amplify and its stakeholders,” Willsher said in a statement. “We are committed to safely operating in a way that ensures the protection of the environing communities.”
The agreement and guilty plea will go to a U.S. district judgefor approval.
This summer, Amplify Energy said it would cover Orange County’s costs of dealing with the spill, and the County Board agreed to the nearly $1 million settlement.
In a separate legal challenge, Amplify this week said it reached an agreement in principle with more than a dozen businesses and residents that brought a class-action suit to resolve all civil claims against the company. Amplify said the company’s insurance policies will fund the settlement, which is subject to court approval. The company did not disclose the settlement amount.
Investigators have determined that the pipeline was compromised as early as January 2021 when it was hit by a cargo ship’s anchor. Amplify is suing two major shipping companies for their alleged roles in the spill.
The suit, filed in California District Court this year, seeks damages from Switzerland-based Mediterranean Shipping Co. and Capetanissa Maritime Corp., a subsidiary of Greek shipping giant Costamare, for dragging ship anchors over Amplify’s pipeline during a storm.