He accepted it wasn't possible to say with certainty what caused the explosion, but it was likely natural gas leaked from Vector's gas pipes to the water pipe. This ignited the gas and caused an explosion.
The Judge found Canadian Pacific had failed to identify the hazard of explosive gas, did not carry out atmosphere testing or monitoring either before or during "hot work'' such as welding and did not instruct its employees to follow Watercare Services' restricted area procedure.
In a statement today, WorkSafe New Zealand general manager of investigations Brett Murray said the explosion was a tragic reminder of the risk of working in areas where there is potentially an explosive atmosphere and the importance of proper monitoring and planning.
"Canadian Pacific had a duty to seek out and monitor hazards. It should have identified the potential hazard of explosive gas and planned to deal with it appropriately.
"The company should have known of the potential risk and carried out proper atmosphere testing before and during the work.''
Judge Ronayne did not order reparation, because although the charges were proven, there was not enough evidence to conclude that Canadian Pacific's failings caused the explosion.
Watercare Services, which contracted Canadian Pacific to do work on the water main, was last year fined $81,000 and ordered to pay $315,000 reparation over the same incident.