In the oil industry, well control insurance is a necessity. There are various names for this type of New Mexico oil field insurance including, energy exploration, operator’s extra expense, and cost of control. Here are some reasons why well control insurance coverage is so important.
Well control insurance protects your assets in the case of a well control incident. One of the covered expenses is the cost of well control. This occurs when your operation needs to pay for capping services and fire control because of an external or below ground blowout. Another well control coverage possibility is repair and restoration coverage. This includes drilling a new well to replace the old one.
When there is an incident with an oil well, it may cause seepage or other damage to the environment around the area. The well control insurance will pay for property damage and the clean up of environmental pollution stemming from the incident.
Care, Custody, and Control
A care, custody, and control provision for your New Mexico oil field insurance covers sub-contractor equipment and materials at the well blow-out site. When acquiring this provision, make sure that you also have evacuation costs covered as well as liability coverage in case of damage to an adjacent well.