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Houston firm to pay millions to settle criminal charges

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A subsidiary of a Houston-based energy firm has agreed to pay $15 million to resolve charges stemming from a 2004 pipeline explosion in Walnut Creek, CA, that killed five workers.

On Sept. 21, KMGP Services Co. Inc., a subsidiary of Kinder Morgan Energy Partners LP, agreed to pay $10 million in penalties to settle the criminal charges stemming from the explosion and $5 million in fines to resolve the related civil case.

Under the plea agreement, the company will be placed on probation for two years and will hire an auditor to evaluate pipeline safety procedures required by federal regulators. A California Superior Court approved the agreement on the same day. According to the district attorney’s office, Kinder Morgan and its insurers already paid “over $69 million to victims, families of victims, and other persons claiming injury.”

In a statement, Kinder Morgan President Tom Bannigan stated, “While it can never make up for the losses associated with this incident, we hope that accepting our share of responsibility and reaching these settlements will help bring closure to this matter.”

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