Insurers Keep an Eye on Fracking

    The well head for for a gas well next to Jean Carter's property is seen Friday, Oct. 14, 2011 in Dimock, Pa. State regulators blame faulty gas wells drilled by Cabot Oil & Gas Corp for leaking methane into the groundwater in Dimock, Pa. It was the first serious case of methane migration related to the Pennsylvania 3-year-old drilling boom, raising fears of potential environmental harm throughout the giant Marcellus Shale gas field. (AP Photo/Alex Brandon)

    Alex Brandon / AP Photo

    Environmentalists say hydraulic fracturing will end the world in a whoosh of lethal contaminants, while drillers say it will save the American economy and inaugurate a utopia of oil and gas. In all the blowback and bluster associated with the controversial drilling technique, oil- and gas-company insurers find themselves wondering just how to assess the risks involved. “From an insurance standpoint, it’s really hard to underwrite something with a lot of uncertainty,” said Jeffrey Hanneman, director of Aon Risk Solutions. The cost is going up for “environmental-impairment liability,” experts said, even as the Environmental Protection Agency prepares to release initial findings later this year on the hazards fracking may or may not pose to drinking water.

    Read it at Reuters