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Wednesday, 13 August 14
WHAT DOES PROJECT CARGO REALLY MEAN TO INSURERS?
 KNOWLEDGE TO ELEVATE
Richard Kamppari-Baker, claims manager of FP Marine Risks, explains the challenges of project cargo risk assessment from an insurer’s point of view.
Project cargo is the large, oversized, overweight heavy lift cargo or critical pieces of equipment that may be high value or time sensitive and sometimes both. Project cargo insurance covers against loss or damage in transit for critical components of large civil, production facility, infrastructure, and/or construction projects.
Considerations
In addition, there are considerations to be taken into account for Delay in Start up (DSU) and Advanced Loss of Profits (ALOP) against loss of income and profit arising from late or non-delivery of critical components due to an accidental occurrence in transit.
Failure of a shipment to arrive, or not arrive intact, can turn a USD10 million cargo loss into a claim ten times its value when factoring in the knock-on effects of one piece of equipment not being ready at a particular date, which then causes disastrous consequences to the project as a whole. Whilst failure of any cargo to arrive has an enormous impact on operations, for project cargo this has far reaching ramifications.
For this reason the assured look towards insurers to cover the additional economic cost when something goes wrong.
Evaluating risk
Insurers will only compensate the assured for the loss or put it back in the same position. So how does an underwriter even start to evaluate the risk when the consequences are not easily apparent? Project cargo is specifically dependent on transport logistics and tight timeframes, so missing any goal or target will have serious knock-on effects.
To begin a proper assessment of the exposure, a few crucial factors need to be considered. The time and costs for re-fabrication as well as for reshipping the item need to be calculated, which is not an easy task when the bespoke nature of these items is considered.
During this time, insurers will need to calculate the knock-on effects when other goals or targets cannot be met. This means they need to evaluate the loss of profit and/or other operational costs at each stage affected until the project is completed. This is by no means guesswork and there is a complex system involved in calculating each risk.
Appraising the exposure is only part of the problem to insurers because one must consider how to move such an item. Project cargo will most likely be out-of-gauge or exceed regular weight limits, so the question is how the transport is to be done. Moving pylons across muddy roads in India during monsoon season, or loading reactors onto vessels, need the highest level of expertise. The services of engineers, surveyors, mariners, naval architects, consultants and government officials will be required. Careful consideration is essential in deciding who to employ.
Relevant experience
A major factor is to ensure the right people with the relevant experience are chosen. A team of international experts may need to be flown out at each stage of the transit. A key role is an individual who will be in charge of coordinating all communications amongst the team, ensuring all members are properly informed whilst avoiding any misunderstanding whatsoever.
Once the determined route has been scrutinised, the next stage is to ensure all requirements are met. Inland transits often require special authorization or conditions and vessels might need special clearance from their P&I clubs or insurers.
Insurers are very reliant on the assured and other experts to advise on stowage and on whether an item is capable of withstanding the rigours of transit. Items that protrude or carry extreme weights present a huge problem while stationary, but these complications are magnified tenfold when combined with extreme forces of rolling and pitching while in transit.
Calculations need to be carried out by professionals, securing contractors to ensure correct fastenings, buttresses, and so on, are used. Stability during the voyage is essential, so great care is taken to ensure the centre of gravity is evenly distributed.
All the advice from the experts is only as good as Mother Nature permits. A final weather routing will often need to be agreed before the shipment can commence.
No matter how fastidious insurers, carriers, freight forwarders and shippers are, there is a chance that an accident will happen. Claims will of course arise when route surveys are not properly carried out of when stowage of fittings are not adequate.
There will always be unforeseen events that cannot be predicted. The role of the insurer is not to take a gamble on whether a shipment will arrive in time and good order, but to know the risks and eliminate the uncertainties. For project cargo this is critically important, given the high cargo values and the potentially enormous claims involved.
Source: FP Marine / Hellenic Shipping
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Thursday, 28 August 14
PANAMAX: OWNERS CAN GET AROUND USD 16000 FOR A FRONTHAUL; PERIOD MARKET - VERY QUIET - FEARNLEYS
Handy
The activity and sentiment is improving in the Atlantic with the general TA rate is up about US$ 800 w-o-w. We see more South American carg ...
Thursday, 28 August 14
BANPU REPORTS HIGHER FIRST-HALF YEAR RESULTS FOR 2014
COALspot.com: Banpu Public Company Limited (BANPU) reports higher first half-year financial results for 2014 having its gross profit increasing 3 p ...
Wednesday, 27 August 14
FREIGHT MARKET: IS THE MARKET IN A RECOVERY MOOD? - GEORGE ILIOPOULOS
Is the market in a recovery mood?
August is typically a time when the shipping industry takes it easy… charter-ers book their requireme ...
Tuesday, 26 August 14
4TH ANNUAL ASIA NICKEL
4th Annual Asia Nickel
19-20 Nov 2014
Grand Hyatt Jakarta, Indonesia
Web Site
Asia’s Premier Nickel Conference
Regulation in ...
Tuesday, 26 August 14
DESPITE LOW DRY BULK RATES, BULKER PRICES ARE STILL HIGH - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
Traditionally, August tends to be a month of slow activity in the sale and purchasing market and this year has been no exception. However, as shipb ...
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- Kepco SPC Power Corporation, Philippines
- Alfred C Toepfer International GmbH - Germany
- Bank of Tokyo Mitsubishi UFJ Ltd
- ASAPP Information Group - India
- Essar Steel Hazira Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Globalindo Alam Lestari - Indonesia
- Mercuria Energy - Indonesia
- Chamber of Mines of South Africa
- Binh Thuan Hamico - Vietnam
- Merrill Lynch Commodities Europe
- Sakthi Sugars Limited - India
- Jaiprakash Power Ventures ltd
- Jindal Steel & Power Ltd - India
- SMC Global Power, Philippines
- Ind-Barath Power Infra Limited - India
- Global Coal Blending Company Limited - Australia
- Maharashtra Electricity Regulatory Commission - India
- PNOC Exploration Corporation - Philippines
- South Luzon Thermal Energy Corporation
- PowerSource Philippines DevCo
- Bukit Baiduri Energy - Indonesia
- Anglo American - United Kingdom
- Eastern Energy - Thailand
- Wilmar Investment Holdings
- Electricity Authority, New Zealand
- Grasim Industreis Ltd - India
- Bangladesh Power Developement Board
- Independent Power Producers Association of India
- ICICI Bank Limited - India
- Lanco Infratech Ltd - India
- Larsen & Toubro Limited - India
- McConnell Dowell - Australia
- GMR Energy Limited - India
- New Zealand Coal & Carbon
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Port Waratah Coal Services - Australia
- Karaikal Port Pvt Ltd - India
- Economic Council, Georgia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Interocean Group of Companies - India
- Kartika Selabumi Mining - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Thiess Contractors Indonesia
- Indian Energy Exchange, India
- Petron Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Orica Mining Services - Indonesia
- White Energy Company Limited
- Holcim Trading Pte Ltd - Singapore
- Orica Australia Pty. Ltd.
- Simpson Spence & Young - Indonesia
- Africa Commodities Group - South Africa
- TeaM Sual Corporation - Philippines
- Posco Energy - South Korea
- Ministry of Finance - Indonesia
- Global Green Power PLC Corporation, Philippines
- Attock Cement Pakistan Limited
- Medco Energi Mining Internasional
- CIMB Investment Bank - Malaysia
- Coalindo Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Bukit Makmur.PT - Indonesia
- Agrawal Coal Company - India
- Siam City Cement - Thailand
- Georgia Ports Authority, United States
- Malabar Cements Ltd - India
- Makarim & Taira - Indonesia
- Vizag Seaport Private Limited - India
- VISA Power Limited - India
- Mjunction Services Limited - India
- Meralco Power Generation, Philippines
- Carbofer General Trading SA - India
- Manunggal Multi Energi - Indonesia
- San Jose City I Power Corp, Philippines
- Mercator Lines Limited - India
- Gujarat Sidhee Cement - India
- LBH Netherlands Bv - Netherlands
- The State Trading Corporation of India Ltd
- Leighton Contractors Pty Ltd - Australia
- Rio Tinto Coal - Australia
- AsiaOL BioFuels Corp., Philippines
- Directorate General of MIneral and Coal - Indonesia
- CNBM International Corporation - China
- The Treasury - Australian Government
- Sindya Power Generating Company Private Ltd
- Minerals Council of Australia
- Baramulti Group, Indonesia
- Thai Mozambique Logistica
- Bahari Cakrawala Sebuku - Indonesia
- Indo Tambangraya Megah - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indika Energy - Indonesia
- Kumho Petrochemical, South Korea
- Toyota Tsusho Corporation, Japan
- MS Steel International - UAE
- European Bulk Services B.V. - Netherlands
- Dalmia Cement Bharat India
- Deloitte Consulting - India
- Maheswari Brothers Coal Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Coal and Oil Company - UAE
- Central Electricity Authority - India
- Commonwealth Bank - Australia
- Singapore Mercantile Exchange
- Standard Chartered Bank - UAE
- Rashtriya Ispat Nigam Limited - India
- Aboitiz Power Corporation - Philippines
- Indogreen Group - Indonesia
- IEA Clean Coal Centre - UK
- Asmin Koalindo Tuhup - Indonesia
- Kaltim Prima Coal - Indonesia
- Power Finance Corporation Ltd., India
- Ceylon Electricity Board - Sri Lanka
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- GAC Shipping (India) Pvt Ltd
- Oldendorff Carriers - Singapore
- Salva Resources Pvt Ltd - India
- Tata Chemicals Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- International Coal Ventures Pvt Ltd - India
- Savvy Resources Ltd - HongKong
- Xindia Steels Limited - India
- Sarangani Energy Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Latin American Coal - Colombia
- Tamil Nadu electricity Board
- Edison Trading Spa - Italy
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Parry Sugars Refinery, India
- Antam Resourcindo - Indonesia
- Renaissance Capital - South Africa
- Therma Luzon, Inc, Philippines
- Aditya Birla Group - India
- Banpu Public Company Limited - Thailand
- Indian Oil Corporation Limited
- Kideco Jaya Agung - Indonesia
- Formosa Plastics Group - Taiwan
- India Bulls Power Limited - India
- Price Waterhouse Coopers - Russia
- Semirara Mining and Power Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Star Paper Mills Limited - India
- Energy Link Ltd, New Zealand
- Borneo Indobara - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Cement Manufacturers Association - India
- Australian Coal Association
- Bhoruka Overseas - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Sree Jayajothi Cements Limited - India
- Eastern Coal Council - USA
- Samtan Co., Ltd - South Korea
- Semirara Mining Corp, Philippines
- Planning Commission, India
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Bulk Trading Sa - Switzerland
- Madhucon Powers Ltd - India
- Mintek Dendrill Indonesia
- Goldman Sachs - Singapore
- Coastal Gujarat Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- PTC India Limited - India
- Electricity Generating Authority of Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Karbindo Abesyapradhi - Indoneisa
- Petrochimia International Co. Ltd.- Taiwan
- The University of Queensland
- Energy Development Corp, Philippines
- Gujarat Electricity Regulatory Commission - India
- Marubeni Corporation - India
- Kobexindo Tractors - Indoneisa
- Wood Mackenzie - Singapore
- Trasteel International SA, Italy
- Krishnapatnam Port Company Ltd. - India
- Videocon Industries ltd - India
- Bayan Resources Tbk. - Indonesia
- Bhushan Steel Limited - India
- London Commodity Brokers - England
- Sical Logistics Limited - India
- Ambuja Cements Ltd - India
- Australian Commodity Traders Exchange
- Central Java Power - Indonesia
- Iligan Light & Power Inc, Philippines
- Riau Bara Harum - Indonesia
- Global Business Power Corporation, Philippines
- Sinarmas Energy and Mining - Indonesia
- Romanian Commodities Exchange
- Timah Investasi Mineral - Indoneisa
- Parliament of New Zealand
- Vedanta Resources Plc - India
- Ministry of Transport, Egypt
- Uttam Galva Steels Limited - India
- Bhatia International Limited - India
- Metalloyd Limited - United Kingdom
- PetroVietnam Power Coal Import and Supply Company
- Straits Asia Resources Limited - Singapore
- Directorate Of Revenue Intelligence - India
- Sojitz Corporation - Japan
- Indonesian Coal Mining Association
- Chettinad Cement Corporation Ltd - India
- Altura Mining Limited, Indonesia
- Intertek Mineral Services - Indonesia
- SN Aboitiz Power Inc, Philippines
- Heidelberg Cement - Germany
- Kalimantan Lumbung Energi - Indonesia
- Bharathi Cement Corporation - India
- Barasentosa Lestari - Indonesia
- Pendopo Energi Batubara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- OPG Power Generation Pvt Ltd - India
- Siam City Cement PLC, Thailand
- GVK Power & Infra Limited - India
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