ContainersFinance and InsuranceMiddle East

Egypt may file $1bn claim for Suez Canal calamity

Egypt could be lining up a $1bn claim in damages after the 20,388 teu Ever Given giant container vessel caused a headline grabbing traffic jam in the Suez Canal for almost a week.

Ossama Rabei, the head of Suez Canal Authority, told Egypt’s Sada ElBalad news channel he estimates the $1bn figure would compensate for losses associated with transit fees, damage to the waterway during the dredging and salvage efforts, and the cost of equipment and labour.

Taiwan’s Evergreen Marine, the charterer of the 2018-built Ever Given, said it is not accountable for delays of any cargo it was transporting and that it expects minor costs for potential loss and damage arising from the blockage of the waterway.

“Our risk exposure to the incident is very, very low,” Evergreen president Eric Hsieh was quoted on local news in Taiwan on Thursday.

“We are only responsible for the carriage of cargoes onboard. Even if we have some claims, those will be covered by insurance,” Hsieh said.

Evergreen has said that the Japanese shipowner, Shoei Kisen Kaisha, would be responsible for any costs including the potential claims from Egypt and third-party liabilities based on its charter arrangement.

Meanwhile, Shoei Kisen has declared General Average. Reports say that Richard Hogg Lindley has been appointed as adjuster.

The Ever Given was refloated on March 29, and towed to the Great Bitter Lake for inspection. The Suez Canal Authority is looking into the incident. Rabei said the ship’s captain has yet to respond to several demands by the canal authority, including surrender of the voyage data recorder and documents sought for the investigation.

The backlog of vessels waiting to transit Suez is now expected to be cleared over the weekend. As for the Ever Given, it could be held in Egypt if the matter of compensation goes to court, however Rabie believes that such a scenario is unlikely.

Adis Ajdin

Adis is an experienced news reporter with a backgroud in finance, media and education. He has written across the spectrum of offshore energy and ocean industries for many years and is a member of International Federation of Journalists. Previously he had written for Navingo media group titles including Offshore Energy, Subsea World News and Marine Energy.

Comments

  1. So predictable… They will blame the crew and exonerate themselves, even though it is rather obvious that lack of escort tug was an issue here. Not to mention that the masters of most ships have very limited experience in canal transit, comparing to SC pilot. Did the Pilot advise Master against taking risks of transiting canal in weather conditions as prevailing on 23rd? For sure the answer is NO. Did the SCA conducted proper risk assessment of ULCC transiting in borderline weather conditions? No, because they would not allow transit otherwise. Was the tug escort required by SCA rules for ULCC in borderline conditions – no. Why? Too expnsive for SCA to maintain adequate No of tugs. But blame all on poor mariner and you come clean and “professional” in every bloody inch, as always the desk-jockeys and paper-pushers do.

    1. Very pertinent.

      Overall, the SCA would probably need to make drastic changes to their operating procedures for the passage of ultra large vessels through the canal.

    2. Why is nobody talking about how incompetent and unprofessional Suez Canal pilots are? From the moment they board the only thing they care about is how many cartons of cigarettes they are going to get. They handwave any information exchange checklists, smoke like chimneys on the bridge (even if banned) and play on their iPad during transit. It is not the Master that should be pointed at, it is the Suez Canal pilots.

      1. At one of my Suez canal tranfer Pilot reading the paper !
        Defenitly room for improvement on pilotage.

      2. I fully agree.
        Pilots are old and behave like kings. No cooperation at all unless cigarettes are given.
        It’s very surprising that ship operators don’t check VDR records to see how transits look in real.
        They don’t follow even basic safety rules during boarding the vessel. None of them has lifejacket but big suitcase for cigarettes.

    3. In my analysis and opinion. This unreasonable overpriced collection of 1bilion dollars damages is back by CCCP Why? Because! Remember The ship is own by a Japanese company and most of the goods ship by evergreen came from Taiwan. China and Taiwan is not in good relations. Also Japan and China is not in good relationship. And China invested billions of dollar in infrastructure in Egypt.

    4. The vessel was transmitting a canal. The vessel masters hand over to scp whom are qualified masters too, i supposed so. The (scp) was onboard during the incident, hence why held the captain fully responsible. Crew alway get the blame. True

    5. Tugs? What nonsense.
      “…the masters of most ships have very limited experience in canal transit…” again with the nonsense – do you honestly think Maersk, Evergreen, Hapag. et.al would hire novice Masters for that big an investment?

    6. Yesterday was the ” Good Friday” for the Captain. Every one wants him crucify. This event can be classified as an ” Act of God” may be as ” human error” but my self crossing the Suez Canal my eyes are very well open at all the time and by sure the Captain of that vessel it’s attention was full on the vessel transit. Billions dollars were it’s responsability.

  2. We might point out that the SCA only “lost” the Canal dues of the ships that chose to go round the Cape. The Canal dues of the ships that waited and which are now going through just got paid a few days later, and the SCA may be paying some overtime to process the backlog faster.

    As for who was at fault, I agree with Majami. The finger of blame points rather squarely at whoever told the Master of the “Ever Given” to take the passage without a tug.

    1. No matter how one views the incident., the final responsibility still lies with the ship master. He has to make the final decision to proceed or not to proceed based on available information.

      1. Yes, the captain is the master and has complete command of the vessel. If he had any reasons not to proceed he should of waited. But I would assume that he as all captains would be forced to continue due to commercial pressures.

  3. Yes this is a huge problem.
    Many ports or transit points requires a “pilot”.
    Yet these so called “pilots” actually have no accountability.
    This is what happens when you have people with responsibilities but no accountability.
    They don’t care what happens.

    The master of the ship is ultimately always responsible AND accountable for the vessel leading to abuse of their vulnerability in such situations.

    1 billion USD is a joke. Does the SCA really think they can get 1b USD? I’ve seen worse situations and damages with a fraction of the claims from SCA.

    Why with 1b USD you might just as well dredge your own canal….

    1. In saying, “so called” pilots, you reveal you haven’t the faintest idea what you are talking about. They ARE called pilots.

      How would “dredging” a canal in Taiwan or Japan, help? And as for your civil engineering cost estimate… Twat.

      1. Pilots in the name only. Suez Canal pilots are the most unprofessional and incompetent mariners I have ever seen.

  4. I trust pilot should be made accountable in international laws. They can’t get away saying they are only in advisory role and ultimately master is reponsible for damage. Any ship internal mistakes can be kept with masters but external environment of local nature pilots have to be made accountable.

  5. These Egyptian cowboys who masquerade as pilots are a pathetic lot. Past experience has shown, that all they are interested is in extracting as many freebies from the Master as they possibly can. Technically the Master takes the rap for whatever happens on board- regardless.
    But is this fair. What was a 220,000 dwt vessel doing in the waterway without an Ocean going tug? 400 meters in length and fully laden. The poor Master will now be made a convenient scapegoat, spending endless months in Egypt during the investigation.

  6. Only a clown will take it so literally.
    Just try to understand the point here & no need for “technical & Engineering expertise”
    Some pilots really get swelled heads when given the red carpet treatment & loose their purpose.

  7. (Rabei said the ship’s captain has yet to respond to several demands by the canal authority, including surrender of the voyage data recorder and documents sought for the investigation.) And by the way please read Collision Regulation Rule no. 2

  8. Plenty to look at here – but the SCA is showing their butt. Egypt will do everything in their power to deflect responsibility and the arguments and posturing will look like Kabuki – ref Air Egypt tragedy. Some aspects of this to consider include not only the lack of competence, and corruption, of their pilots, but also the quality of any emerg planning, application of weather forecasts to transiting procedures/decisions (predicted high winds – you must have a capable tug?), and their no doubt gutless fleet of support vessels (tugs). That ship was only freed when some real Bollard Pull showed up – and those were not Egyptian boats. The reality is that any financial loss is partly – if not totally – on them.

  9. To be very frank..it is not Suez canal..but Marlboro canal…

    Rest all is understood..
    Most uncooperative and incompetent pilot I have seen in my Sea carrier is of Suez canal

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