Major Quake in Southern California Could Cause $300B in Losses

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Experts say Southern California is long overdue for a major earthquake along the 800-mile San Andreas Fault — and analysis by catastrophe-modeling firm AIR Worldwide predicts the price tag for California could approach “upwards of $300 billion.”

According to said Robert de Groot, a U.S. Geological Survey scientist, “A 180-mile rupture along the southern portion of the state’s San Andreas Fault could produce the ‘Big One,’ a 7.8-magnitude earthquake. He said it would be felt “pretty widely throughout the state” and even as far as Las Vegas but “the worst shaking will be in the Los Angeles basin.”

Southern California’s regional infrastructure is at risk for extensive and expensive damage from a significant (high magnitude 7) earthquake.

Ports — If the ‘Big One’ damaged the L.A./Long Beach port complex, it could result in a  supply-chain nightmare to U.S. businesses and manufacturers, since the port handles a huge share (more than 30 percent) of the nation’s cargo. In the event of significant earthquake damage, the L.A. port complex could end up having to move ships to other terminals or even divert vessels to other West Coast ports, such as Oakland.

Rail Lines, Highways and Bridges — the rail lines that carry the goods from ports, as well as the highways and bridges that the trucks use, could suffer devastating damage in a big quake and take weeks or months to repair, putting a halt to the transportation of goods in and out of the nation’s largest port complex.

Water Infrastructure — an earthquake could cut off a major water supply for L.A. and other parts of Southern California, where more than 23 million people live. The region gets about 70 percent of its water delivered through three aqueducts that cross the San Andreas Fault, and a study by the L.A. Mayor’s Office revealed that a 7.8-magnitude quake could cripple that water supply for 15 months. The Metropolitan Water District of Southern California, which uses the Colorado River Aqueduct to supply nearly 19 million people, estimates it would take about six months to recover from a supply disruption if a major quake hit the southern portion of the San Andreas fault. After the region’s last major temblor — the 6.7-magnitude Northridge earthquake in 1994 — MWD built a reservoir that carries a six-month emergency supply of water for Southern California.

Source: CNBC

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