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Cravens Warren

Serving the risk management and commercial insurance needs of business. Cravens Warren, founded in 1946, has been serving the insurance needs of... read more

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Sour Gas and Insurance Exposures for Oil & Gas Producers

By CW Energy Division | Mar 19, 2013
Sour Gas and Insurance Exposures for Oil & Gas Producers image

  One of the most frightening hazards in the oil & gas business, is the potential for a sour gas or hydrogen sulfide incident. Many areas where the gas is found have been identified but pockets of the gas can occur almost anywhere making the potential risk something to take very seriously.

Sour gas, or Hydrogen sulfide,  is a flammable colorless gas that is toxic at extremely low concentrations. Being heavier than air, it can accumulate in low-lying areas creating serious risks for human exposure. Sour gas (H2S) has a "rotten egg" smell and can be detected at very low concentrations by smell. At higher concentrations (over 100ppm) it rapidly disables your sense of smell by paralyzing the olfactory nerve. Without a sense of smell as a natural warning mechanism individuals can succumb to hydrogen sulfide poisoning, very likely leading to death by poisoning the respiratory system.  Active monitoring should be in place to detect any such failures and respiratory protective gear must to be worn whenever high levels of this gas are detected.

  In addition to the dangers to human beings, sour gas can create severe and costly damage to well pipe, pipelines and gas production & processing equipment. When hydrogen sulfide comes in contact with water it forms a highly corrosive acidic reaction. This reaction corrodes steel and can lead to significant material and production losses.

  Safe operating procedures and risk mitigation of potential sour gas incidents are vital to ensuring the safety of any operation. Companies involved in any aspect of exploration or production should be certain that their exposure for sour gas incidents such as well blowouts, are adequately covered by their current oil & gas insurance program. Proper risk management and insurance analysis by experienced specialists can be a key step in implementing the right measures to protect both the producer and the public. For more information, or for an oil & gas insurance review, contact one of our industry specialists today.