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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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Tuesday, 26 August 14
GOVT ON TRACK TO LIMIT COAL OUTPUT - THE JAKARTA POST
The government has announced that it will proceed with plans to cap the production of coal next year, a move aimed not only at protecting the envir ...
Monday, 25 August 14
4TH ANNUAL FLOATING TERMINALS
4th Annual Floating Terminals
18-20 Nov 2014
Intercontinental Jakarta Midplaza,
Indonesia
Web Site
The Floating Terminal c ...
Monday, 25 August 14
THE BALTIC DRY IS JUMPING, BUT DON'T DRAW ANY BROAD CONCLUSIONS - NASDAQ
Those who consistently preach doom and gloom and see an economic apocalypse around every corner would make me laugh if it weren’t for the fac ...
Monday, 25 August 14
COAL CEOS: DEMISE OF COAL 'EXAGGERATED' - MARK WILCOX
By Mark Wilcox
Heads of some of the largest coal companies in Wyoming are saying the demise of coal has been exaggerated, though the industry def ...
Monday, 25 August 14
INDO COAL SWAPS W-O-W: NEGATIVE; M-O-M: POSITIVE
COALspot.com: Indonesian coal swaps for average September 2014 decreased US$ 0.15 (-0.28%) day on day and US$ 0.65 (-1.19%) per mt week on week. Th ...
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- Central Electricity Authority - India
- Agrawal Coal Company - India
- International Coal Ventures Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Directorate General of MIneral and Coal - Indonesia
- SMG Consultants - Indonesia
- Anglo American - United Kingdom
- Global Green Power PLC Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Eastern Coal Council - USA
- The Treasury - Australian Government
- Pendopo Energi Batubara - Indonesia
- GMR Energy Limited - India
- Xindia Steels Limited - India
- Samtan Co., Ltd - South Korea
- Bayan Resources Tbk. - Indonesia
- Kumho Petrochemical, South Korea
- Madhucon Powers Ltd - India
- Central Java Power - Indonesia
- Bhatia International Limited - India
- Chettinad Cement Corporation Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Savvy Resources Ltd - HongKong
- Directorate Of Revenue Intelligence - India
- GAC Shipping (India) Pvt Ltd
- Antam Resourcindo - Indonesia
- Uttam Galva Steels Limited - India
- Dalmia Cement Bharat India
- Romanian Commodities Exchange
- Africa Commodities Group - South Africa
- Bhoruka Overseas - Indonesia
- Latin American Coal - Colombia
- Petron Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- PetroVietnam Power Coal Import and Supply Company
- Wood Mackenzie - Singapore
- Grasim Industreis Ltd - India
- Power Finance Corporation Ltd., India
- Coastal Gujarat Power Limited - India
- Binh Thuan Hamico - Vietnam
- Ind-Barath Power Infra Limited - India
- SN Aboitiz Power Inc, Philippines
- Coal and Oil Company - UAE
- Straits Asia Resources Limited - Singapore
- Attock Cement Pakistan Limited
- Holcim Trading Pte Ltd - Singapore
- Australian Coal Association
- Carbofer General Trading SA - India
- Mercuria Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PowerSource Philippines DevCo
- Bukit Makmur.PT - Indonesia
- Deloitte Consulting - India
- Mjunction Services Limited - India
- Jindal Steel & Power Ltd - India
- Larsen & Toubro Limited - India
- Renaissance Capital - South Africa
- Mintek Dendrill Indonesia
- Wilmar Investment Holdings
- Coalindo Energy - Indonesia
- Merrill Lynch Commodities Europe
- Mercator Lines Limited - India
- Borneo Indobara - Indonesia
- MS Steel International - UAE
- Bukit Baiduri Energy - Indonesia
- Gujarat Sidhee Cement - India
- Intertek Mineral Services - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Minerals Council of Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Kepco SPC Power Corporation, Philippines
- Ministry of Transport, Egypt
- Energy Link Ltd, New Zealand
- Petrochimia International Co. Ltd.- Taiwan
- McConnell Dowell - Australia
- Cigading International Bulk Terminal - Indonesia
- Electricity Generating Authority of Thailand
- Maharashtra Electricity Regulatory Commission - India
- Meralco Power Generation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Indogreen Group - Indonesia
- Manunggal Multi Energi - Indonesia
- Chamber of Mines of South Africa
- Oldendorff Carriers - Singapore
- India Bulls Power Limited - India
- Aboitiz Power Corporation - Philippines
- Star Paper Mills Limited - India
- Bhushan Steel Limited - India
- Electricity Authority, New Zealand
- European Bulk Services B.V. - Netherlands
- Independent Power Producers Association of India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Medco Energi Mining Internasional
- Australian Commodity Traders Exchange
- San Jose City I Power Corp, Philippines
- Price Waterhouse Coopers - Russia
- Sarangani Energy Corporation, Philippines
- Bharathi Cement Corporation - India
- Kalimantan Lumbung Energi - Indonesia
- Global Business Power Corporation, Philippines
- Indika Energy - Indonesia
- Thai Mozambique Logistica
- Kaltim Prima Coal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Parliament of New Zealand
- Kohat Cement Company Ltd. - Pakistan
- Tata Chemicals Ltd - India
- Meenaskhi Energy Private Limited - India
- Global Coal Blending Company Limited - Australia
- Kideco Jaya Agung - Indonesia
- Indo Tambangraya Megah - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Essar Steel Hazira Ltd - India
- Karaikal Port Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- CIMB Investment Bank - Malaysia
- IEA Clean Coal Centre - UK
- Sical Logistics Limited - India
- Riau Bara Harum - Indonesia
- Orica Australia Pty. Ltd.
- Sree Jayajothi Cements Limited - India
- Timah Investasi Mineral - Indoneisa
- Baramulti Group, Indonesia
- Barasentosa Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- Edison Trading Spa - Italy
- Lanco Infratech Ltd - India
- Metalloyd Limited - United Kingdom
- Kartika Selabumi Mining - Indonesia
- Ambuja Cements Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Vizag Seaport Private Limited - India
- Jaiprakash Power Ventures ltd
- Maheswari Brothers Coal Limited - India
- Leighton Contractors Pty Ltd - Australia
- VISA Power Limited - India
- Planning Commission, India
- Karbindo Abesyapradhi - Indoneisa
- White Energy Company Limited
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Standard Chartered Bank - UAE
- Bulk Trading Sa - Switzerland
- Gujarat Electricity Regulatory Commission - India
- Ministry of Finance - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Marubeni Corporation - India
- Interocean Group of Companies - India
- Bangladesh Power Developement Board
- Indian Oil Corporation Limited
- Posco Energy - South Korea
- LBH Netherlands Bv - Netherlands
- Goldman Sachs - Singapore
- The University of Queensland
- Ministry of Mines - Canada
- Jorong Barutama Greston.PT - Indonesia
- The State Trading Corporation of India Ltd
- Makarim & Taira - Indonesia
- Commonwealth Bank - Australia
- Simpson Spence & Young - Indonesia
- Malabar Cements Ltd - India
- Therma Luzon, Inc, Philippines
- PTC India Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- GN Power Mariveles Coal Plant, Philippines
- Parry Sugars Refinery, India
- Gujarat Mineral Development Corp Ltd - India
- SMC Global Power, Philippines
- Semirara Mining Corp, Philippines
- Iligan Light & Power Inc, Philippines
- Tamil Nadu electricity Board
- Georgia Ports Authority, United States
- New Zealand Coal & Carbon
- Heidelberg Cement - Germany
- Miang Besar Coal Terminal - Indonesia
- Orica Mining Services - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Indonesian Coal Mining Association
- Indian Energy Exchange, India
- Videocon Industries ltd - India
- Rashtriya Ispat Nigam Limited - India
- Vedanta Resources Plc - India
- Semirara Mining and Power Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Rio Tinto Coal - Australia
- Port Waratah Coal Services - Australia
- Siam City Cement PLC, Thailand
- GVK Power & Infra Limited - India
- Asmin Koalindo Tuhup - Indonesia
- TeaM Sual Corporation - Philippines
- Energy Development Corp, Philippines
- Sindya Power Generating Company Private Ltd
- Formosa Plastics Group - Taiwan
- Salva Resources Pvt Ltd - India
- ASAPP Information Group - India
- Banpu Public Company Limited - Thailand
- Aditya Birla Group - India
- Cement Manufacturers Association - India
- Economic Council, Georgia
- Thiess Contractors Indonesia
- Altura Mining Limited, Indonesia
- CNBM International Corporation - China
- Sojitz Corporation - Japan
- PNOC Exploration Corporation - Philippines
- Eastern Energy - Thailand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- TNB Fuel Sdn Bhd - Malaysia
- Trasteel International SA, Italy
- Singapore Mercantile Exchange
- ICICI Bank Limited - India
- Kapuas Tunggal Persada - Indonesia
- Siam City Cement - Thailand
- London Commodity Brokers - England
- Sakthi Sugars Limited - India
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