Utility Takes $462 Million Charge For Gas Explosion Recovery

NORTH ANDOVER, MA -- NiSource, the parent company of Columbia Gas of Massachusetts, took a third-quarter charge of $461.9 million for third-party claims and other expenses stemming from the September 13 gas explosions in Lawrence, Andover and North Andover. The company released its third quarter results Thursday, posting a loss of $345.1 million, or $0.95 per share, for the three months ended Sept. 30, down from net income of $14.0 million, or $0.04 per share, a year ago.

In a press release, NiSource said it expects to recover most of the $461.9 million in claims to its insurers. But the company warned that the total costs could go up, as no claims had been recorded when the fiscal quarter ended on September 30.

"We are deeply humbled by what happened in Massachusetts, and realize that much work lies ahead of us to finish the service restoration in the Lawrence area, and to regain the trust of our customers and communities," NiSource President and CEO Joe Hamrock said. "We continue to marshal the needed resources and adjust our approach to best accommodate and meet our customers' needs."

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Despite the financial charge, NiSource said it still expected annual earnings to grow in the coming years and that it remained on pace to grow annual shareholder dividends by five to seven percent. The company said it would also continue improving infrastructure in the seven states in which it operates.

"Safety and the care of our customers is the foundation of our business. Although the reviews of what occurred are not complete, NiSource is taking steps across our seven-state footprint to enhance the safety of low-pressure systems," Hamrock said. "These enhancements will benefit all customers and communities we serve across all seven states."

The September 13 gas explosions damaged or destroyed more than 130 buildings in the Merrimack Valley and killed an 18-year-old Lawrence man. As on Wednesday, more than 7,000 customers remained without gas service

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File photo of NiSource CEO Joe Hamrock by Dave Copeland.

Dave Copeland can be reached at dave.copeland@patch.com or by calling 617-433-7851. Follow him on Twitter (@CopeWrites) and Facebook (/copewrites).