A construction firm has appeared in court over a major gas leak that caused widespread disruption and sparked fears of an explosion in Liverpool city centre.

Merepark Construction had been hired as the principal contractor for a multi-million-pound project to convert the former Lewis’s department store into a new hotel, shops and offices. A gas supply pipe was damaged by falling debris during demolition work, causing a two-inch hole (pictured), and on 19 January 2012, hundreds of people were evacuated from the area after one worker smelt gas.

The city's busiest train station, Liverpool Central, was also closed for most of the afternoon, along with shops and local businesses.

Liverpool Magistrates' Court was told that Merepark Construction had arranged for the pipes – which led from the gas meter into the building – to be disconnected, but had failed to take any action to either disconnect the gas supply to the meter or protect the four-inch supply pipe from demolition work.

Merepark Construction of Garden Lane in Altrincham was found guilty of two breaches of the Health and Safety at Work etc Act 1974 by failing to ensure the safety of workers or the public, and was fined £30,000 and ordered to pay £8,490 in prosecution costs.

Speaking after the hearing, Health & Safety Executive inspector Catherine Willars said: "The gas supply pipe could clearly be seen entering the service duct from the street, but Merepark Construction failed to take any action to disconnect it, protect it from falling rubble or to warn the demolition firm of the dangers.

"A single spark could have set alight the leaking gas and caused a major explosion in the city centre, with the potential to put dozens of lives at risk. Luckily, the emergency services' response worked effectively and they were able to prevent an explosion, but the incident caused significant disruption and hit the income of local businesses.

"Merepark was the principal contractor on a major refurbishment project but its safety standards fell way below the legal minimum on this occasion."

Information for construction companies on tackling the risk of gas explosions is available at www.hse.gov.uk/fireandexplosion.