EXPERT WITNESS AND DISPUTE SUPPORT - Property Damage and Business Interruption Insurance Claims
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EXPERT WITNESS AND DISPUTE SUPPORT
Property Damage and Business Interruption Insurance Claims
Baker & O'Brien consultants are frequently retained as consulting or testifying
experts and have been qualified to offer evidence in many insurance-related matters
involving the oil and gas, chemicals, and power generation industries. Services to
RELATED INDUSTRIES
the insurance industry include: (a) asset valuation for determining insurable values; Additional Process Industries
(b) forensic investigations to determine cause and liability; (c)property damage and Gas Processing
cost to rebuild estimates; (d) business interruption claims due to accidents or other Oil and Gas Production
unscheduled downtime; (e) estimates of loss incurred during the transportation, Petrochemical / Chemical
storage, and processing of oil or gas; and (f) technical assistance in the claim Petroleum Refining
adjustment process. Our insurance industry clients have included some of the Power Generation
largest underwriters and brokerage houses in the world. Renewable / Alternative Energy
Transportation and Storage
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EXPERT WITNESS AND DISPUTE SUPPORT
Property Damage and Business Interruption Insurance Claims
PRIMARY CONTACTS
Daniel R. Finelt
Consultant
Houston
Peter W. Halliday
Vice President
Dallas
Charles J. Hirst
Senior Vice President
Dallas
David C. Tamm
Senior Vice President
Houston
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EXPERT WITNESS AND DISPUTE SUPPORT
Property Damage and Business Interruption Insurance Claims
RELATED EXPERIENCE
Ammonia Plant Construction Insurance Dispute
Evaluated the technical basis for a ammonia plant insurance claim involving construction defects and warranty work. Inspected
the plant, evaluated project records, and reviewed maintenance records.
Business Interruption Damages Claim by Concrete Supplier
Provided an expert consultant business interruption loss estimate for damages to a concrete products producer as a result of an
incident at an oil refinery.
Chemical Plant Business Interruption Claim
Analyzed the impact of a major equipment fabrication error on a chemical plant business interruption (BI) claim including schedule
delay and financial impacts.
Business Interruption Claim and Root Cause Analysis
Monitored rebuild engineering and construction of facilities damaged by fire and offered expert opinion on the appropriate
construction period for the business interruption claim. Participated in the incident root cause analysis.
Chemical Plant Insurance Claim Support
Provided comprehensive technical and accounting support for a property damage claim settlement and analysis for a chemical
manufacturing plant that was damaged during a hurricane. Work included review of all repair cost estimates and invoiced repair
invoices, as well as analysis of claimed damages discovered and submitted post-recovery. Assistance was also provided during
final claim settlement negotiations.
Crude Oil Processing Contract Dispute
Served as expert witness concerning a dispute between an international oil trading company (Trader) and an independent refining
company (Refiner), between whom there was a crude oil processing contract. The Trader alleged that the Refiner misappropriated
products to its own account. Analyzed the refinery production and product disposition under each processing deal over a period of
three years and calculated the damages under the alleged misappropriation. Prepared an independent detailed damages claim for
insurance purposes and defended the claim at trial.
Defective Product Lawsuit
Provided an expert report concerning a dispute between a pressure safety relief device manufacturer and an operator of a claim
that a device did not operate as designed in a reactor overpressure incident.
Gas Pipeline Rupture Dispute
Performed an independent assessment of the costs incurred, including the lost natural gas inventory, on a ruptured interstate gas
transmission line for which the owner requested a multi-million dollar damage reimbursement. A report was prepared for mediation
which resulted in a negotiated settlement.
Gas Turbine Damage
Assisted in a root-cause analysis and damages dispute concerning a major turbine failure in the start-up of a power plant.
Hurricane Rita Claim
A petrochemicals facility experienced a loss of steam supply from an outside steam supplier and a subsequent unscheduled
shutdown which, in turn, resulted in production losses and major damage to the facility. The steam supplier attributed the steam
outage to boiler damage caused by a hurricane, which had made landfall several months earlier. Assisted by investigating the link
between the hurricane and the steam supplier boiler outages.
Incident Analysis - Petrochemicals
Performed an investigation analysis following fire and explosion incidents at a major Gulf Coast manufacturing facility. The
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EXPERT WITNESS AND DISPUTE SUPPORT
Property Damage and Business Interruption Insurance Claims
Performed an investigation analysis following fire and explosion incidents at a major Gulf Coast manufacturing facility. The
engagement entailed development of the sequence of events, root cause analysis, assessment of the decision to rebuild, and
reconstruction monitoring. An independent project schedule and cost estimate for the plant reconstruction was developed.
Insurance Arbitration
Investigated the circumstances surrounding an oil spill at a Gulf Coast refinery following a hurricane. Work focused on whether the
refiner acted as a "prudent operator" before and after the hurricane and whether the owner was entitled to a claim for damages
based on an insurance policy's pollution exclusion clause. Prepared a written report for submission into evidence in an
international arbitration.
Refinery Environmental Contamination Insurance Litigation
Provided expert witness testimony and analysis regarding liability and damages for petroleum refinery environmental
contamination insurance claims across the U.S. based on the multiple insurance contracts for each site.
PVC Plant Litigation
Assisted in a dispute concerning allegations that an explosion at a major manufacturer of PVC resins was due to a poor process
design that failed to meet government regulations and engineering standards. Assisted in discovery, inspected the plant,
evaluated procedures and work methods, reviewed applicable standards, and reviewed operating records.
Supply and Distribution
Assisted in a dispute concerning the effects of Hurricanes Katrina and Rita on jet fuel prices for the Gulf Coast market. The
sequence of events and impacts on individual suppliers were developed, as well as an allocation of outages and price differentials
attributable to each hurricane. Our analysis of pricing activity also considered estimates of normalized versus event-based price
movements in the overall market.
Subsea Pipeline Rupture
Assisted attorneys in investigating the circumstances surrounding a rupture of a subsea crude oil pipeline caused by a vessel
dragging an anchor. This assignment included a review of the impact on crude oil gathering system and receiving terminal
operations, the owner's emergency response, subsea pipeline repair costs, and a determination of the maximum insurable loss.
Refinery Business Interruption
Prepared detailed analyses of property damage, business interruption, and demurrage claims resulting from a vessel allision with a
refinery dock.
Root Cause Analysis
Conducted a Root Cause Failure Analysis on a high pressure steam turbine that failed following a planned outage at a
cogeneration power plant. Evaluated outage work procedures, actual outage work undertaken, start-up monitoring results, and
post-failure turbine inspection results on turbine disassembly.
Refinery Business Interruption
Determined the economic damages suffered by a refiner as a result of multiple incidents which eventually led to reduced feed to
the refinery. Project required the analysis of all refining units, including their actual and planned operations and maintenance.
Alternative utilizations of feedstock and supply of products were also investigated.
Polyolefins Plant Explosion
Assisted attorneys and company in preparation for litigation and negotiation with government agencies while investigating the
cause of an explosion which caused the death of over 20 people. Assisted risk management in preparing and negotiating property
damage and business interruption claims in excess of $1.3 billion.
Polypropylene Manufacturing
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EXPERT WITNESS AND DISPUTE SUPPORT
Property Damage and Business Interruption Insurance Claims
Assisted in a dispute concerning insurance claims for property damage and business interruption in connection with a reactor
incident during construction of a production facility.
Refining Market Forecast
Investigated business interruption claims from fuels refineries, lube refineries, cement plants, fuels distributors, and chemicals
manufacturers due to the closure of marine access following the release of oil into the waters surrounding the plants.
Gas Plant Explosion & Subsequent Insurance Claims
Assisted resolution of claims between insurance company and Owners/Operators related to a gas plant explosion. Reviewed
property damage and business interruption claims for accuracy and veracity.
Crane Accident Claim Analysis
Analyzed business interruption and property damage insurance claim by a refinery operator resulting from a crane accident. This
included analysis of the cost to repair the physical damage from the accident, the impact to schedule and cost of a process unit
turnaround that was in progress at the time of the accident, and valuation of lost production due to the accident.
Oil Field Pipe Dispute-Insurance Claim
Reviewed a claim involving an insurance dispute relating to proper preservation of drilling pipe in a storage yard following a
hurricane.
Refinery Explosion, Subrogation of Insurance Claim
Assisted in a dispute concerning a rebuild estimate, which was the subject of subrogation, for an oil refinery process plant
damaged by an explosion.
Review Insurance Claim
Reviewed a petroleum refinery business interruption insurance claim resulting from a dock closure because of an oil spill.
Plant Commissioning Review
Provided initial guidance and comments regarding the development of a commissioning and start-up schedule for a polypropylene
plant. Provided initial input into how plant start-up incidents affected the commissioning schedule.
Gas Compressor Incident Dispute
Provided expert opinions concerning a gas compressor failure insurance claim related to: (1) evaluating the gas processing
facilities' maintenance and standard of care practices compared to industry standards; and (2) reviewing the operating practices
and programs utilized at the facility to determine if these practices caused or contributed to the incident and subsequent damage.
Hurricane Damage Insurance Dispute
Assessed the impact of a hurricane to a refinery and its impact on turnarounds being executed at residue upgrading process units.
Support included investigating failures incurred to a flare and to a heater, their relationship to the hurricane, and subsequent
shutdowns of process units.
Shipyard Insurance Claim Analysis
Assessed a business interruption claim filed by a shipyard that resulted from a third-party incident. Based upon our analysis of the
claimant's business operations and performance, claim estimates were developed that formed the basis for settlement
negotiations.
Refinery Fire Damage Assessment and Rebuild Costs
Assisted in a dispute concerning fire damages and estimated rebuild costs at a petroleum refinery, as well as monitored the
rebuild project.
Gas Plant Fire Damage Repair Costs
Assessed fire-related damages and estimated rebuild cost for a cooling tower at a gas plant.
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EXPERT WITNESS AND DISPUTE SUPPORT
Property Damage and Business Interruption Insurance Claims
Petrochemicals Business Interruption Claim
Assisted in a dispute concerning a petrochemicals business interruption claim and lawsuit after a declaration of force majeure by a
manufacturer.Reviewed pertinent data and prepared written reports, affidavits, and deposition regarding the business interruption
claims.
Fuel Contamination Investigation
Investigated an occurrence of contaminated diesel fuel at a mine facility, as well as the claimed property damage and business
interruption claims. Assessed the root cause of the fuel contamination and prepared a presentation of our findings.
Dock Collision Business Interruption Claim
Assisted in a dispute concerning a refinery business interruption claim and lawsuit after a marine vessel allision with a refinery
dock. Analyzed need for extraordinary refined product marine and pipeline movements, as well as trading activity and demurrage
claims.
Pipeline Pigging Incident Investigation
Following a plant incident caused by the ingress of water, we investigated upstream pipeline activities and operating records to
determine the root cause of the incident.
Terminal Hurricane Damage Repair and Claim
Assisted in a dispute concerning a rebuild estimate for a terminal damaged by a hurricane.
RFCC Arbitration Expert Report
Arbitration expert witness opinion on residual fluid catalytic cracking (RFCC) operations, prudent operating procedures, and force
majeure claims related to an RFCC incident.
Sulfuric Acid Plant Fire Investigation
Investigated cause for sulfuric acid plant fire. Reviewed plant operating conditions prior to the fire and the unit design to identify the
cause and potential contributing causes to the fire and subsequent explosions.
Refinery Business Interruption - Marine Spill
Conducted an assessment of business interruption damages stemming from downtime caused by an oil spill which disrupted
marine traffic at several adjacent manufacturing facilities.
Coker Incident and Design Assessment
Reviewed project management procedures and facilities design of an oil refinery project after a subsequent structural failure.
Provided written report and oral deposition regarding design responsibility and failure liability.
Power Transmission Fire Investigation
Investigated the cause of major fire that resulted in a fatality.
Heat Exchanger Failure Investigation
Investigated circumstances concerning a heat exchanger failure that resulted in a fire and explosion, fatally injuring several
employees. Investigation included evaluating relevant operating records and comparing these with design specifications to
evaluate whether exchanger was operated, inspected and maintained in accordance within design parameters and industry
practices. Prepared expert report.
Tank Truck Fatality Incident
Provided inspection of truck tank and tank cleaning facilities related to a fatality accident. Investigation including collecting samples
of tanker contents for further testing.
Undersea Pipeline Damage Repair Costs
Assisted client by providing opinion on reasonableness of claimed repair costs to an undersea pipeline damaged by a ships's
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Property Damage and Business Interruption Insurance Claims
anchor.
Refinery Business Interruption Assessment
Estimated the lost profit (business interruption claim) stemming from a contractor incident which caused an extended refinery
outage.
Hydrogen Sulfide Incident Investigation
Following a fatality caused by exposure to hydrogen sulfide at a crude oil storage tank with a known sour gas atmosphere,
investigated the causes for the incident and the operating and maintenance practices (standard of care) with respect to:
supervision, training, and use of personal protective equipment.
Confined Space Incident and Dispute
Provided support in a wrongful death dispute regarding a confined workspace incident. The incident involved nitrogen
asphyxiation where two maintenance contractors died. Investigated the cause and origin of the incident, including work procedures
and practices.
Contractor Tripping Incident
Investigated circumstances concerning the personal injury of a contract employee. Provided opinions regarding general safety
requirements, industry practices, contractor training and safety expertise and utilizing contractors for the activity being performed.
Storage Tank Spill Incident
Developed an expert witness report associated with a spill from a sour naphtha storage tank. Reviewed numerous documents
and depositions to develop opinions associated with the event. Provided expert opinions on the standards of care and operation of
a petroleum refinery.
Valve Failure Investigation: Herbicide Plant
Investigated the design and operations of a batch reactor process for the manufacture of herbicides in relation to a piping failure.
Equipment material of construction was the focus of the analysis.
Chemical Plant Fire Repair
Provided technical advice and consultation for recommended repair procedures for vessels and piping damaged in a chemical
plant fire.
Fall-Related Injury Investigation
Investigated circumstances concerning the personal injury of a contract employee who fell inside a flue gas system during a
refinery turnaround. The investigation included evaluation of: (1) refinery safe work practices compared to industry standards; (2)
utilization of fall arrest systems to mitigate the presence of fall hazards; (3) the responsibilities of both operating companies and
contractors to recognize and develop plans to mitigate fall hazards; and (4) responsibilities of both parties to execute and
communicate turnaround work plans.
Stainless Steel Braided Hose Failure
Provided technical expert witness assistance in dispute concerning the failure of a braided stainless steel hose in a medical facility.
Storage Tank Foundation Failure
Following the failure of a storage tank foundation, we reviewed the applicable documentation and prepared an affidavit concerning
the standard of care used during its construction.
Debutanizer Tower, H2S Incident
Developed an expert witness report associated with an incident concerning an H2S release during the scheduled turnaround
activities involving a debutanizer tower.
Refinery Economic Losses Due to Fire
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Property Damage and Business Interruption Insurance Claims
Prepared an assessment to quantify the economic damages resulting from a refinery fire that caused damage to equipment and a
lengthy shutdown of a refinery distillation and conversion train. Prepared a detailed report that documented both business
interruption losses and repair costs for damaged equipment. Provided testimony in deposition and district bench trial.
Ethanol Plant Business Interruption Dispute
Reviewed an insurance claim for an ethanol plant "opportunity loss" due to a power outage resulting from repair work on main
electrical feed cables after being damaged by a construction contractor. Reviewed operating expenses and ethanol pricing during
the subject period and provided an opinion on the reasonableness of the size of the claim.
Marine Dock Business Interruption Claim
Reviewed documents and provided analysis concerning a marine collision with the crude oil unloading dock, which resulted in a
business interruption claim for a Gulf Coast refiner.
Refinery Business Interruption Claim
On behalf of an insurer, calculated the business interruption expense for a Gulf Coast refinery associated with a delay in receiving
crude oil via ship. Reviewed calculations provided by the refinery and opined on associated business interruption impacts
associated with the delay in receiving crude oil shipments. Provided an expert report, which enabled a settlement in the dispute.
Refinery Business Interruption Claim
Provided technical support for a business interruption claim associated with a refinery fire. Evaluated refinery linear program
model used to develop the "but for" cases. Prepared a report with recommended corrections to the linear program model "but for"
case output.
Business Interruption Claim Analysis
Reviewed preliminary business interruption calculations related to a ship collision incident at a refinery dock. Developed a revised
business interruption estimate, which resulted in a claim settlement.
IPP/Refinery Power Generation Outage Dispute
Assessed the cause(s) of supplier's steam and electricity generation failure and mitigating actions by the refinery/petrochemical
customer. Preliminary findings and a document request were provided to the client.
Refinery Construction Dispute
Provided expert consulting support assessing EPC contractor’s responsibilities, project execution, and start-up issues associated
with the construction and start-up of a refinery expansion project. Assisted client in two areas: (1) assessed circumstances
associated with a piping failure to determine if failure was due to poor engineering design; and (2) organized retained materials to
assist with insurance claim.
Explosion Insurance Claim
Provided report presenting a reasonable timeline and duration to source, contract, start, and conduct the demolition of the parts the
Gas Plant damaged after the plant experienced a fire and explosion.
Ammonia Plant Failure Investigation
Assisted in evaluating a series of insurance claims centered around separate events to determine a proximate cause. Work
included reviewing design and operating records for a worldscale ammonia plant. Each of the events resulted in claims
for property damage and business interruption. Prepared an analysis and report that evaluated the root cause for each of the
events and whether the events were connected by a chain of causation.
Electrostatic Precipitator Explosion
Investigated the cause and origin of an explosion in an electrostatic precipitator used in a cement manufacturing plant that was the
subject of an insurance claim. Reviewed operating records for temperatures, pressures, and flow rates through a rotating cement
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Property Damage and Business Interruption Insurance Claims
kiln. Evaluated operation of the electrostatic precipitator for anomalies prior to the explosion. Concluded that the cause and orgin
related to a mechanical failure in the kiln. Provided findings to the owner and its insurer and supported decisions regarding
coverage and subrogation issues.
Refinery Incident CLaim
Assisted in the investigation of a refinery leak and fire. Coordinated the collection of information related to the incident and
disseminated it to the relevant parties. Helped audit incident related retained materials and developed inventory documentation.
Ethylene Plant Construction Dispute
Opined on the reasonable period of time for the completion phase of a rebuild project after a fire during an expansion project.
Commented on the implementation of relief system changes during the rebuild to be in compliance with standards and codes.
Marine Dock Damage Insurance Claim
Analyzed the business interruption insurance claim of petroleum product terminal that was impacted by marine dock damage
caused by the collision of an arriving ship. Provided advice regarding potential mitigations concerning the terminal’s product
movements.
Insurance - Sugar Mill: Lost Production Claim
A steam-driven turbo-generator in a sugar mill failed, causing loss of production. There was a dispute between the mill owner and
its insurer concerning the physical damages and the business interruption losses. We were engaged to evaluate the claim.
Tank Collapse Dispute
Investigated the cause of a tank collapse that occurred during cleaning activities in preparation for a planned internal inspection.
Assessment included evaluating: (1) condition of the tank prior to the incident; (2) work processes utilized by contractor
performing tank cleaning; (3) maintenance and inspection practices of tank operator; (4) industry accepted practices for tank
inspection; and (5) contributing causes that led to the incident. Baker & O'Brien also assessed the cost to clean the tank and
perform repairs following the incident. Developed expert report and provided support through mediation and settlement efforts.
Hurricane Product Shortage Claim Assessment
Assessed a product shortfall by a chemical producer following Hurricane Harvey. Provided
volume and revenue estimates, taking into consideration port closures and the timing of
force majeure declarations.
Refinery Power Failure
A power supply failure at a refinery resulted in a complete and extended outage of the
refinery, as well as long-term impacts to refinery operation. Opined on the duration of the
outage, the refiner’s actions, and refinery procedures during the restart effort with respect to
typical refinery restart efforts. Also calculated the economic damages suffered by the
refinery as a result of the power outage.
Insurance Support: Liability and Business Interruption
Assessed the merits of a liability claim and business interruption claim associated with an
equipment failure in a sulfuric acid regeneration facility. Advised on the value and key
determinants of a business interruption claim.
Personal Injury Liability Investigation
Investigated a personal injury claim following a petroleum refinery process incident. Provided expert opinions on refinery
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Property Damage and Business Interruption Insurance Claims
Investigated a personal injury claim following a petroleum refinery process incident. Provided expert opinions on refinery
conformity with the latest available industry technology, regulations, standards, and practices.
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