INSURICA Energy Times

With rising insurance premiums, successfully managing fleet risk should be a top priority as we enter a new year. The Occupational Safety and Health Administration (OSHA) stated that most road related fatalities occur on highways where there are seat belt requirements and traffic laws, between the hours of 7 a.m. and 4 p.m. Additionally, the U.S. Department of Transportation National Highway Traffic Safety Administration (NHTSA) 2020 annual traffic crash data reported over 38,000 fatalities related to U.S. traffic crashes, and this creates a serious conundrum for insured and insurers alike.

According to the Bureau of Labor Statistics nearly 500,000 workers are currently employed in the oil and gas extraction industry in the United States, and that number is on the rise as the world’s demand for energy continues to grow. This increase means more risks for well operators as they struggle to keep up with demand. Fortunately, there are many types of coverages available to those in the oil and gas industry to help mitigate these risks.

Properly trained personnel are essential for well control activities. Well control consists of two basic components: an active component of monitoring the pressure of the drilling fluid, and blowout preventers as a passive component. The first line of defense in well control is to have sufficient drilling-fluid pressure in the well hole. During drilling, underground fluids such as gas, water or oil under pressure (the formation pressure) oppose the drilling-fluid pressure (mud pressure). If the formation pressure is greater than the mud pressure, there is possibility of a blowout.