Energy business: Fractious fracking

15 Sep 2015

Hydraulic fracturing to drill for shale gas looks likely to become a reality in the UK, so insurers are weighing up some lessons learned from recent US experiences.

A recent article in Reactions magazine explores the lessons that UK insurers can learn from their American counterparts on how to model methane extraction, the challenges that would face potential insurers and the contrasting objections that British residents have compared to Americans.

Michael Salau, head of environment at BLM, commented on the issue further. He said: “Lancashire Council’s main objections to Cuadrilla’s intended operations were simpler: visual impact and noise pollution…. Despite fracking being a relatively unknown exposure for the UK’s insurance industry, there is some appetite from the industry to cover fracking’s risks, while re/insurers can also simply add excursions for manmade earthquakes. Old policies are simply amended where necessary.”

You can read the article in full on the Reactions website, a subscription is required.


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Disclaimer: This document does not present a complete or comprehensive statement of the law, nor does it constitute legal advice. It is intended only to highlight issues that may be of interest to clients of BLM. Specialist legal advice should always be sought in any particular case.

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