Class Code: 6235

Per NCCI's Scopes Code Description:

Code 6235 applies to drilling or redrilling oil or gas wells and includes erection or dismantling of drilling rigs, formation fracturing, cementing, installation of casing, and flowback services when such operations are performed by employees of the drilling company. Cleaning or swabbing of a new well that has not yet been completed is included in Code 6235 whether performed by employees of the driller or by a specialist contractor.

Also included in Code 6235 are employers that own and lease specialty tools and equipment, with complete operating crews, to drilling contractors. Employers leasing specialty drilling tools and equipment with supervisory employees only are assigned to Code 6213.

Oil or gas well holes are usually drilled using either a cable or rotary-type rig. The cable rig involves dropping a pointed bit that is attached to a cable repeatedly into a hole until the hole reaches the desired depth. The rotary rig involves drilling a hole by applying pressure to a drilling stem that has a rotating bit attached to it. The latter method is used for vertical, directional, and horizontal drilling. Directional drilling is the process of drilling a curved well, in order to reach a target that is not directly beneath the drill site. Horizonal drilling can make a 90 degree turn in only a few feet to reach less accessible reservoirs.

Although size and makeup of a drilling crew may vary from rig to rig, a typical crew consists of a tool pusher, a driller, a derrick person, and two or three roughnecks, also known as rotary helpers or floor persons. Occasionally, the crew includes a motor person, rig mechanic, and/or electrician. The tool pusher is in charge of the overall drilling operation and is sometimes referred to as a rig foreperson, manager, supervisor, or rig superintendent. The driller is directly in charge of the drilling operations. The driller’s principal duties include operating the drilling and hoisting equipment, operating the downhole tools, measuring pipes, and monitoring the downhole condition of the well. The derrick person handles the upper end of the drill stem as it is lowered into or hoisted out of the hole and may also be responsible for conditioning of drilling fluids (mud) and circulating equipment. Roughnecks are usually stationed on the derrick floor to perform work incidental to operating the rig. The motor person, if any, is responsible for maintenance and service of rig engines. The rig mechanic, if any, is a handyperson, who repairs equipment as necessary. The rig electrician, if any, repairs and maintains electrical generating and distribution systems on the rig as well as the rig’s electrical wiring and lighting systems.

Analogy Assignments:

When performed by a drilling company, Code 6235 applies to stimulation methods that increase the flow of a well, such as injection wells, water flooding, and fracturing. Fracturing involves pumping fluid under high pressure into rock fractures to expand them and also leaving a “propping agent,” such as sand, to keep the fractures open. This allows the oil or natural gas to move more freely from the rock pores to a production well.

Employers that provide flowback services are included in this classification if the services are performed by a drilling company. Flowback refers to a process by which the fluid used for fracturing a shale formation is recovered from the well at the surface. Flowback is performed in preparation for a subsequent phase of treatment, or to clean up and transition the well to a production stage. Flowback engineers who only monitor and log flowback pressure are assigned to Code 6237.

Special Conditions:

Extra-Territorial Classification Guidelines:

The following material was developed by NCCI to be used as a guide by auditors and underwriters in the determination of premium for contracting (construction risks) with extra-territorial employments where no company guidelines have been established for this purpose. Construction classifications are indicated by the addition of a construction code symbol () next to the classification code number.

   
1.    Payroll of employees of contractors who have their place of business in a given state and operate also in adjoining states and who are constantly crossing state lines, but usually return to their homes each night, must be assigned to their headquarters’ state. Example: Contractors such as electricians, plumbers, carpet layers, etc.
2.    The payroll for construction project managers, executives, or superintendents who may visit a job but who are not in direct charge of a job must be assigned to the state in which their headquarters are located.
3.    There are contractors who maintain a permanent staff of employees and superintendents. If any of these employees or superintendents is assigned to a job that is located in a state other than their headquarters’ state, either for the duration of the job or any portion thereof, their payroll must be assigned to the highest rated of either the state in which the job is located or the headquarters’ state.
4.    The payroll of employees who is hired for a specific job project must be assigned to the state in which the job is located.

When a portion of the operations of a risk are insured in a monopolistic state fund, consider the special rules and requirements that may exist in such cases.

CROSS-REF.  DRILLING OR REDRILLING OF OIL OR GAS WELLS & INSTALLATION OF CASING, DRIVERS

(N/A FL)

Note:  Includes flowback services when performed during drilling or redrilling operations.

CROSS-REF.  OIL OR GAS—WELL—SHOOTING & DRIVERS

(N/A FL)

Note:  Includes flowback services when performed during drilling or redrilling operations.

Rate per $100. of Renumeration: $ 4.22

Construction Exemption Required: Yes