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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, 22 July 14
ASIAN SUB-BITUMINOUS COAL USERS' GROUP CONFERENCE
Press Release: Registration Open for Fourth Annual Asian Sub-Bituminous Coal Users’ Group Conference
Register today for this year&r ...
Monday, 21 July 14
25% OF INDIA'S POWER PLANTS WERE HAVING SUPER CRITICAL COAL STOCK - COAL AND POWER MINISTER
25% of India’s power plants were having super critical coal stock; power utilities have also been advised to enhance the import of coal - Coa ...
Monday, 21 July 14
INDONESIA'S STATE CONTROLLED COAL MINER BUKIT ASAM ENJOYED HIGHER SELLING PRICE DURING THIS STORMY MARKET
COALspot.com: PT Bukit Asam, the Indonesian government controlled coal miner announced today that, the company has produced 7.70 million tons of co ...
Monday, 21 July 14
CFR SOUTH CHINA COAL Q3 DELIVERY SWAPS LOST 16% SINCE JANUARY 17, 2014
COALspot.com: Coal price falling is continues as the impact oversupply and lower demand. Market is not showing any positive trend in near future.
...
Sunday, 20 July 14
THE FREIGHT MARKET CONTINUED ITS DOWNWARD TREND
COALspot.com: The market continued its downward trend this week as all segments were down compared to last week. The Cape and Panamax indices being ...
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- Singapore Mercantile Exchange
- Borneo Indobara - Indonesia
- Grasim Industreis Ltd - India
- South Luzon Thermal Energy Corporation
- Rashtriya Ispat Nigam Limited - India
- Minerals Council of Australia
- New Zealand Coal & Carbon
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- Coal and Oil Company - UAE
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- Metalloyd Limited - United Kingdom
- IEA Clean Coal Centre - UK
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- GN Power Mariveles Coal Plant, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Central Electricity Authority - India
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- White Energy Company Limited
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- GVK Power & Infra Limited - India
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- Star Paper Mills Limited - India
- Sindya Power Generating Company Private Ltd
- Bangladesh Power Developement Board
- Orica Mining Services - Indonesia
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- Indian Oil Corporation Limited
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- Ministry of Mines - Canada
- Bhushan Steel Limited - India
- Wood Mackenzie - Singapore
- Aditya Birla Group - India
- OPG Power Generation Pvt Ltd - India
- Kumho Petrochemical, South Korea
- Timah Investasi Mineral - Indoneisa
- Mjunction Services Limited - India
- Kepco SPC Power Corporation, Philippines
- Interocean Group of Companies - India
- Globalindo Alam Lestari - Indonesia
- Toyota Tsusho Corporation, Japan
- Attock Cement Pakistan Limited
- PNOC Exploration Corporation - Philippines
- Sical Logistics Limited - India
- GMR Energy Limited - India
- Chettinad Cement Corporation Ltd - India
- Coalindo Energy - Indonesia
- Directorate Of Revenue Intelligence - India
- Commonwealth Bank - Australia
- Global Coal Blending Company Limited - Australia
- Bayan Resources Tbk. - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Carbofer General Trading SA - India
- Port Waratah Coal Services - Australia
- Romanian Commodities Exchange
- European Bulk Services B.V. - Netherlands
- Asia Pacific Energy Resources Ventures Inc, Philippines
- TeaM Sual Corporation - Philippines
- Trasteel International SA, Italy
- Barasentosa Lestari - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Mercuria Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- The University of Queensland
- Siam City Cement - Thailand
- Planning Commission, India
- Deloitte Consulting - India
- Bhoruka Overseas - Indonesia
- SN Aboitiz Power Inc, Philippines
- Thai Mozambique Logistica
- MS Steel International - UAE
- IHS Mccloskey Coal Group - USA
- Jindal Steel & Power Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Karaikal Port Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Tamil Nadu electricity Board
- Meralco Power Generation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Bharathi Cement Corporation - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- ASAPP Information Group - India
- Central Java Power - Indonesia
- Oldendorff Carriers - Singapore
- Petron Corporation, Philippines
- Vedanta Resources Plc - India
- Energy Development Corp, Philippines
- Banpu Public Company Limited - Thailand
- Posco Energy - South Korea
- ICICI Bank Limited - India
- Intertek Mineral Services - Indonesia
- VISA Power Limited - India
- Kobexindo Tractors - Indoneisa
- Semirara Mining and Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Electricity Generating Authority of Thailand
- India Bulls Power Limited - India
- Krishnapatnam Port Company Ltd. - India
- Australian Coal Association
- Antam Resourcindo - Indonesia
- Bhatia International Limited - India
- Ministry of Transport, Egypt
- Wilmar Investment Holdings
- Altura Mining Limited, Indonesia
- Electricity Authority, New Zealand
- Merrill Lynch Commodities Europe
- Bukit Makmur.PT - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Makarim & Taira - Indonesia
- International Coal Ventures Pvt Ltd - India
- Videocon Industries ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Therma Luzon, Inc, Philippines
- Georgia Ports Authority, United States
- Directorate General of MIneral and Coal - Indonesia
- Heidelberg Cement - Germany
- Binh Thuan Hamico - Vietnam
- Miang Besar Coal Terminal - Indonesia
- Indo Tambangraya Megah - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Sakthi Sugars Limited - India
- Rio Tinto Coal - Australia
- Indian Energy Exchange, India
- Bulk Trading Sa - Switzerland
- TNB Fuel Sdn Bhd - Malaysia
- Vizag Seaport Private Limited - India
- Power Finance Corporation Ltd., India
- Economic Council, Georgia
- Sarangani Energy Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- The Treasury - Australian Government
- Kartika Selabumi Mining - Indonesia
- Standard Chartered Bank - UAE
- McConnell Dowell - Australia
- Semirara Mining Corp, Philippines
- Sree Jayajothi Cements Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement PLC, Thailand
- Maheswari Brothers Coal Limited - India
- Malabar Cements Ltd - India
- Chamber of Mines of South Africa
- PowerSource Philippines DevCo
- Latin American Coal - Colombia
- Gujarat Sidhee Cement - India
- AsiaOL BioFuels Corp., Philippines
- LBH Netherlands Bv - Netherlands
- Global Green Power PLC Corporation, Philippines
- Madhucon Powers Ltd - India
- Mercator Lines Limited - India
- SMC Global Power, Philippines
- Indonesian Coal Mining Association
- Ambuja Cements Ltd - India
- Medco Energi Mining Internasional
- Iligan Light & Power Inc, Philippines
- Savvy Resources Ltd - HongKong
- Energy Link Ltd, New Zealand
- Kideco Jaya Agung - Indonesia
- Essar Steel Hazira Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Price Waterhouse Coopers - Russia
- Australian Commodity Traders Exchange
- PTC India Limited - India
- Eastern Coal Council - USA
- Lanco Infratech Ltd - India
- Baramulti Group, Indonesia
- CNBM International Corporation - China
- Edison Trading Spa - Italy
- Mintek Dendrill Indonesia
- Jaiprakash Power Ventures ltd
- Orica Australia Pty. Ltd.
- GAC Shipping (India) Pvt Ltd
- Cigading International Bulk Terminal - Indonesia
- Larsen & Toubro Limited - India
- Straits Asia Resources Limited - Singapore
- Eastern Energy - Thailand
- Ministry of Finance - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Meenaskhi Energy Private Limited - India
- Thiess Contractors Indonesia
- Uttam Galva Steels Limited - India
- Independent Power Producers Association of India
- Xindia Steels Limited - India
- London Commodity Brokers - England
- Bukit Baiduri Energy - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tata Chemicals Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ind-Barath Power Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Formosa Plastics Group - Taiwan
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- Global Business Power Corporation, Philippines
- Marubeni Corporation - India
- Africa Commodities Group - South Africa
- Dalmia Cement Bharat India
- Holcim Trading Pte Ltd - Singapore
- The State Trading Corporation of India Ltd
- Anglo American - United Kingdom
- Aboitiz Power Corporation - Philippines
- Riau Bara Harum - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Ceylon Electricity Board - Sri Lanka
- Kaltim Prima Coal - Indonesia
- Coastal Gujarat Power Limited - India
- Sojitz Corporation - Japan
- Billiton Holdings Pty Ltd - Australia
- Parliament of New Zealand
- San Jose City I Power Corp, Philippines
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