LOS ANGELES COULD FACE MASSIVE LIABILITY IF PLAYA VISTA DEVELOPMENT IS APPROVED AT GAS STORAGE SITE

LOS ANGELES, CA, June 8, 2001- Los Angeles City Council is expected to meet next Tuesday to take up the issue of the Playa Vista Housing Development on the west side of the City. This development is situated at the site of Southern California Gas Company’s (SoCalGas) Playa del Rey underground gas storage facility.

The Grassroots Coalition and other civic action groups are urging City officials, including the civil division of the City Attorney’s office and the City Controller, to investigate the potential liability associated with this development.

In a report issued February 26, 2001, City Controller, Rick Tuttle, estimates that Los Angeles for the first time surpassed the $1 billion mark in reported total liability. Of this, approximately $125 million is made up of current and future damages involving the Rampart police scandal.

"If the Public Health and Safety issues we believe exist at the Playa Vista site are ignored and residents are killed or injured," stated Patricia McPherson, president of the Grassroots Coalition, "the resulting liability could dwarf the Rampart costs."

SoCalGas records indicate that billions of cubic feet of natural gas are being held at pressures of 1700 pounds per square inch (psi) and above in the partially depleted Playa del Rey oil field that underlies the area. According to the State Division of Oil and Gas, a network of underground pipes fans out from the SoCalGas compressor station located at the edge of the property. These high-pressure injection pipes are used to force the gas into the geological formations below.

Evidence shows that, once in the ground, the enormous pressure can force the gas to migrate through the substrata. According to a number of professional gas migration experts including Oil and Gas Environmental Consultant, Bernard Endres, PhD, co-author of "Gas Migration" (Butterworth-Heinemann Publishers), there is no way to accurately determine if or where the gas may surface.

"But we know it’s going somewhere because, in a recent study by one of the preeminent experts on underground gas storage, Dr. M. Rasin Tek, it was determined that massive amounts of gas are lost from this site each year," Endres said.

"Since 1942, natural gas has been piped into the old Playa del Rey oil fields," said McPherson. "Back then it was farm land. I don’t think anyone ever expected it to be a residential area."

Dr. Endres observed that, as a result of an explosion in a rural area near Brenham, Texas involving gas leaking from an underground storage site, a jury awarded $138 million to twenty-two victims of the accident.

"If this had occurred in a high density area such as the proposed Playa Vista development, hundreds would have been killed. Since the City is aware of the location of the gas storage area and are allowing construction to proceed anyway, if there is an accident the potential for litigation is staggering," Dr. Endres added.

"I think the taxpayers of Los Angeles have a right to know that this development has the potential to financially cripple the city," McPherson concluded.

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