April 1 PG&E Corp was hit on Tuesday with federal criminal charges involving safety violations related to a deadly 2010 natural gas line rupture and fire in San Bruno, California, that destroyed a neighborhood killed eight people.
The U.S. Attorney's Office alleges that PG&E knowingly and willfully violated the Pipeline Safety Act between 2003 and 2010.
Reuters had earlier reported that the utility provider was in discussions with the U.S. Attorney's office in an attempt to reach a fair settlement but expected to face federal charges related to record keeping, pipeline integrity management and identification of pipeline threats.
"PG&E believes that its employees did not intentionally violate the federal Pipeline Safety Act," the company said in a statement on Tuesday.
The California Public Utilities Commission had also proposed fining the company $2.25 billion over the incident, requiring the utility to spend the entire fine on safety.
The charges come more than three years after a rupture in a portion of a high-pressure gas transmission pipeline, Line 132, caused a fire, killing eight people and injuring 58 others in a residential neighbourhood in the city of San Bruno.
The incident related to the pipeline operated by the company in the Northern District of California also damaged 108 homes.
The company has also settled claims amounting to nearly $500 million with the affected victims and families.
The case no. is 14-cr-00175 in the United States District Court for the Northern District of California. (Reporting by Narottam Medhora in Bangalore; Editing by Lisa Shumaker)