1. Oil and Gas Training
Lusaka April 2016

2. Oil and Gas Risk Exposures
Oil and gas value chain
Exploration
& Development
Hydrocarbon Production
Shipping
Refining
& Blending
Storage
Distribution
Marketing

3. Oil and Gas Risks and Exposures (E&P cycle)
NIGERIAQIT
CAMEROUN
Abandonment
Acreage acquisition
LAGO S
Reservoir Mgt
Operations
QI L
Basin analysis
Facilities installation
Exploration and Production Life
Cycle
Prospect generation
Facilities construction
Facilities design
Economic analysis
ATA
Field development
Wildcat Drilling
Field Development Plan
Appraisal drilling
Economic
analysis 6
(Rated B+ by AM Best)

4. NO INSURABLE ACTIVITY AT THIS STAGE
FIRST PHASE
ACREAGE ACQUISITION
NO INSURABLE ACTIVITY AT THIS STAGE

5. Production Sharing Contract (PSC)
Agreement between Host Nation and Foreign Oil Company to explore for Hydrocarbons within an agreed ‘Block”
Valid for a set number of years with a commitment for a minimum amount of exploration
Price is paid to “lease” the block
Royalty and/or % split of “Profit Oil” is determined.

6. Oil and Gas Risks and Exposures (E&P cycle)
NIGERIAQIT
CAMEROUN
Abandonment
Acreage acquisition
LAGO S
Reservoir Mgt
Operations
QI L
Basin analysis
Facilities installation
Exploration and Production Life
Cycle
Prospect generation
Facilities construction
Facilities design
Economic analysis
ATA
Field development
Wildcat Drilling
Field Development Plan
Appraisal drilling
Economic
analysis 6
(Rated B+ by AM Best)

7. BASIN ANALYSIS AND PROSPECT GENERATION
SECOND PHASE
BASIN ANALYSIS AND PROSPECT GENERATION

8. Oil and Gas Formation

9. Oil and Gas Reservoir

10. Seismic Surveying

11. SEISMIC OPERATIONS PHYSICAL DAMAGE LIABILITY
EXPLOSIVES - IN TRANSIT / IN STORAGE
AUTOMOBILES
SEISMIC VESSEL
LIABILITY
THIRD PARTY LIABILITY
EMPLOYERS LIABILITY } OWN EMPLOYEES
WORKMANS COMPENSATION
LOW RISK PHASE OF OPERATION

12. READ THE CONTRACT NOT JUST THE INSURANCE SECTION OF THE CONTRACT
INSURANCE CLAUSE
LIABILITY CLAUSE
INDEMNITY CLAUSE

13. Oil and Gas Risks and Exposures (E&P cycle)
NIGERIAQIT
CAMEROUN
Abandonment
Acreage acquisition
LAGO S
Reservoir Mgt
Operations
QI L
Basin analysis
Facilities installation
Exploration and Production Life
Cycle
Prospect generation
Facilities construction
Facilities design
Economic analysis
ATA
Field development
Wildcat Drilling
Field Development Plan
Appraisal drilling
Economic
analysis 6
(Rated B+ by AM Best)

14. WILDCAT and EXPLORATION DRILLING
THIRD PHASE
WILDCAT and EXPLORATION DRILLING

15. Major Risks Associated with Oil and Gas
Upstream
Well Blowout: Costs of control:
Loss of the Well:

16. Major Risks associated with Oil and Gas
POLLUTION AND OTHER THIRD PARTY LIABILITY RISKS

17. Well Layout

18. Directional Drilling

19. Jack-Up Rigs

20. Semi-Submersible Rigs

21. Drill Ships

22. Drill Bits

23. Mud System

24. Drill Pipe

25. Well Casing

26. Blowout Preventer

27. Establishing Production

28. When Things Go Wrong!

29. Deepwater Horizon

30. Deepwater Horizon Recovery Measures

31. Major Risks Associated with Oil and Gas
Upstream
Well Blowout: Coverage required.
Associated costs including Costs of control, Re-drilling costs,
Clean-Up of seepage and pollution Operators Extra
Expenses (OEE)

32. Major Risks associated with Oil and Gas
Third party liabilities in all stages: (CGL) Comprehensive General Liability Insurance

33. EXPLORATORY DRILLING (1)
PHYSICAL DAMAGE
RIG
DRILLING EQUIPMENT / CONSUMABLES
IN HOLE EQUIPMENT
AUTOMOBILES
CARE CUSTODY AND CONTROL
CARGO

34. EXPLORATORY DRILLING (2)
LIABILITY OF OPERATOR
THIRD PARTY LIABILITY
EMPLOYERS LIABILITY
WORKMANS COMPENSATION
OPERATORS EXTRA EXPENSES (INSURANCE OF THE WELL)
COST OF WELL CONTROL
REDRILLING EXTRA EXPENSES
CLEAN UP OF SEEPAGE / POLLUTION

35. DRILLING OPERATIONS OFFSHORE WELL
Drilling Equipment offshore
PHYSICAL DAMAGE and DRILLING OPERATORS LIABILITIES
Drill ships
Jack-up drilling units
Semi-submersibles
Submersibles/swamp barge

36. Oil and Gas Risks and Exposures (E&P cycle)
NIGERIAQIT
CAMEROUN
Abandonment
Acreage acquisition
LAGO S
Reservoir Mgt
Operations
QI L
Basin analysis
Facilities installation
Exploration and Production Life
Cycle
Prospect generation
Facilities construction
Facilities design
Economic analysis
ATA
Field development
Wildcat Drilling
Field Development Plan
Appraisal drilling
Economic
analysis 6
(Rated B+ by AM Best)

37. COVERAGES AS PER EXPLORATORY DRILLING
FOURTH PHASE
APPRAISAL DRILLING
COVERAGES AS PER EXPLORATORY DRILLING

38. Oil and Gas Risks and Exposures (E&P cycle)
NIGERIAQIT
CAMEROUN
Abandonment
Acreage acquisition
LAGO S
Reservoir Mgt
Operations
QI L
Basin analysis
Facilities installation
Exploration and Production Life
Cycle
Prospect generation
Facilities construction
Facilities design
Economic analysis
ATA
Field development
Wildcat Drilling
Field Development Plan
Appraisal drilling
Economic
analysis 6
(Rated B+ by AM Best)

39. FIELD DEVELOPMENT CONSTRUCTION
FIFTH PHASE
FIELD DEVELOPMENT CONSTRUCTION
AND INSTALLATION

40. Major Risks Associated with Oil and Gas
Loss of or damage to production/process equipment during Construction Fabrication, load-out, installation, testing and commissioning: (CAR or OFFSHORE BUILDERS’ RISKS)

41. Construction and Installation (1)
PHYSICAL DAMAGE
CONSTRUCTION INSURANCE ON PRODUCTION FACILITIES (ON/OR OFFSHORE)
DRILLING EQUIPMENT / CONSUMABLES
IN HOLE EQUIPMENT
AUTOMOBILES
CARE CUSTODY AND CONTROL
CARGO
FSO/FPSO AND ALL MOORING FACILITIES

42. Construction and Installation (2)
LIABILITY
LIABILITY UNDER CONSTRUCTION POLICY
LIABILITY FOR DRILLING OPERATIONS
EMPLOYERS LIABILITY
WORKMANS COMPENSATION
OPERATORS EXTRA EXPENSES (DRILLING AND EXISTING)
COST OF WELL CONTROL
REDRILLING EXTRA EXPENSES
CLEAN UP OF SEEPAGE AND POLLUTION

43. Construction of Fixed Platform

45. Oil and Gas Risks and Exposures (E&P cycle)
NIGERIAQIT
CAMEROUN
Abandonment
Acreage acquisition
LAGO S
Reservoir Mgt
Operations
QI L
Basin analysis
Facilities installation
Exploration and Production Life
Cycle
Prospect generation
Facilities construction
Facilities design
Economic analysis
ATA
Field development
Wildcat Drilling
Field Development Plan
Appraisal drilling
Economic
analysis 6
(Rated B+ by AM Best)

46. FACILITY OPERATIONS AND RESERVOIR
SIXTH PHASE
FACILITY OPERATIONS AND RESERVOIR
MANAGEMENT

47. Major Risks Associated with Oil and Gas
Loss of or damage to production/process equipment during operation: Operational All Risks Insurance Upstream Downstream

48. PRODUCTION (OPERATION) (1)
PHYSICAL DAMAGE
ONSHORE PRODUCING ASSETS
OFFSHORE PRODUCING ASSETS OIL STOCKS
OIL AND GAS STOCKS
FSO/FPSO AND MOORING SYSTEMS
PIPELINES
DRILLING EQUIPMENT / CONSUMABLES
IN HOLE EQUIPMENT
AUTOMOBILES
CARE CUSTODY AND CONTROL
CARGO

49. PRODUCTION (operational) 2
LIABILITY
THIRD PARTY LIABILITY
EMPLOYERS LIABILITY
WORKMANS COMPENSATION
OPERATORS EXTRA EXPENSES (DRILLING AND EXISTING)
COST OF CONTROL
REDRILLING EXTRA EXPENSES
CLEAN UP OF SEEPAGE AND POLLUTION

50. Oil and Gas Risk Exposures
Oil and gas value chain
Exploration
& Development
Hydrocarbon Production
Shipping
Refining
& Blending
Storage
Distribution
Marketing

51. Other insurances in the value chain
REFINING,STORAGE and DISTRIBUTION

52. Refining and storage Physical Damage and Liabilities Refineries
LNG plants
Petrochemical plants
Fertiliser plants
Storage depots
Stocks of crude and product
All Risks coverage
Machinery Breakdown
Business Interruption
Liabilities

53. Transportation Physical damage and liabilities
Pipelines/Compressor Stations
Road tankers (land)
Oil tankers (sea)
LNG carriers
LPG carriers
Product in transit
Product in pipelines
Coverage
Hull
Cargo All risks
Property All Risks
Auto
Associated liabilities

54. Recommended coverage
Operator extra expenses (Insurance of the wells drilling, in
production, work over and suspended)
Coverage: EED8.86+ALL EXTENSIONS
Well control
Re-drilling extra expenses
Clean up of seepage and pollution
Combined single limit for offshore operations a minimum of five
times AFE for onshore a minimum of three times AFE

55. Recommended coverage Liability
Offshore operations minimum limit $100million any one occurrence.
Onshore operations minimum limit $50million any one occurrence.

56. Recommended Coverage
Physical Damage of production assets under construction
(offshore): WELCAR 2001 WITH EXTENSIONS
Sum insured: Full contract value plus 25%
Sub limits for defective parts, leak search, removal of debris, mobilisation & de-mobilisation etc

57. Recommended coverage
Physical damage of production assets in operation: ALL RISKS POLICY FORM.
Sum insured: New replacement value
Sub limit removal of debris.

58. Other Coverages Construction Delay in Start up Operational
Loss of Revenue/Business Interruption

59. THANK YOU