Although the oil and gas industry is one of the most profitable, it remains one of the most dangerous too. Lawsuits are not uncommon; for example, Victoria Oil and Gas (VOG) announced that its subsidiary Gaz du Cameroun S.A., a British Virgin Islands company, and VOG have entered into a confidential Settlement Agreement with CHL. Hence, terminating the litigation with CHL and the CHL Royalty Agreement.
Single onsite negligence could lead to the loss of many lives, including those with no idea what was happening.
Therefore, this makes working in the industry very sensitive, and oil and gas insurance is necessary.
Also, oil and gas insurance spans beyond protecting lives, as it involves securing assets and important vessels required in exploration.
Check Out: Professional Indemnity Insurance in Cameroon.
An Overview of Oil and Gas Insurance
The oil & gas insurance business are unique due to the numerous potentially hazardous situations that could befall the work.
From offshore to onshore production, acts like war, terrorist infiltration, civil unrest, and kidnapping could occur.
This is because most oil exploration sites are primarily located in remote areas.
Furthermore, oil and gas insurance covers a broad industry area, including exploration, transportation, production, and refining.
As an employer, purchasing insurance for your oil and gas business should be non-negotiable.
Why Get Oil and Gas Insurance?
Oil & gas insurance is vital because of the nature of the work.
In reality, the industry comprises limited procedures, harsh and complex working conditions, and chemical reactions that increase risk.
This industry has a high tendency to lose human life and the environment. Therefore, everyone and assets need to be insured to cover a good percentage of the liability should an accident occur.
What does oil and gas insurance cover?
An oil and gas insurance policy is very flexible and could be designed to cover several general and specific premeditated incidences.
However, its coverage generally includes:
- Business interruption, property, and third-party liability insurance for companies and independent operators. Also, most companies provide cover for drilling contractors onsite involved in production and exploration.
- Employee benefits schemes depend on the company and its employees' benefits.
- Political evacuation insurance protects companies and staff from the hassle and cost of emergency relocation and transportation due to rising political unrest.
- Kidnap insurance (essential for high-profile staff working in remote areas prone to kidnapping).
What does oil and gas insurance cover?
Oil & gas insurance has the following benefits:
- Protection against oil risks.
- Third-party liability protection.
- Cost of control, re-drilling, and well-cleaning.
- Operators' extra expenses (OEE).
- Coverage of all operational risks, including onshore and offshore physical damages.
Where to purchase oil and gas insurance?
Not all insurance companies offer oil and gas insurance in Cameroon. However, a handful of them do. Read more about the top insurance companies in Cameroon.
Conclusion
Oil and gas insurance is essential for protecting company assets, including life and property. This is so because it benefits all parties, saving the company, staff, and insurance company in all three directions.