The Role of General Average in the Maritime Industry

“General Average” is a term used in the maritime industry to define shares in a common loss during maritime accident.

 

Defined by York Antwerp rules 1994 of General Average, these rules lay guidelines for the distribution of loss in an event when cargo has to be jettisoned in order to save the ship, crew, or the remaining cargo.

The rule states the apportionment of losses amongst the parties involved in any maritime adventure in case of an extra ordinary sacrifice or if the expenditure is made intentionally with proper justification that the causes for the same involved preserve the other property from risk of being lost.

cargo-ship

 

 

The underlying cause which led to introduction of General Average was, in event of the grave situations where safety of ship, crew members and cargo was jeopardized.

It’s always a difficult decision for ship’s crew to take appropriate action to save the interests of cargo owners and the ship. The time constraints in such exigencies don’t allow the ship’s crew to decide which cargo to jettison and which to leave. Consequently there would be a hot debate arising among cargo and ship owners as to whose cargo has been jettisoned and whose interests compromised. The loss being totally on the account of the person whose cargo has been discharged.

Thus, in order to regulate unprejudiced interests of all those parties who enter into a common maritime venture, a powerful tool named General  Average was introduced, in the York Antwerp rules of 1890 and later reviewed and amended recently in 1994.

The clauses of General Average under the York Antwerp Rules 1994 can be simplified as under

  • A loss is deemed to be considered under general average if and only if the reason of sacrifice is extraordinary or the sacrifice is reasonably made for the purpose of common safety for preserving the property involved .E.g.  Capsizing due to inclement weather condition, shifting of cargo leading to excessive listing of vessel

Falling-Containers

 

  • When two or more vessels are pushing or towing and are involved in a commercial reason, then general average applies if they disconnect from each other in order to preserve the vessel and the cargo
  • General average shall be applied only for those losses which are linked directly with the material value of the cargo carried or the vessel. Any claims arising due to the delay, a loss or expense caused due to loss of market  or any indirect loss must not be accounted into general average
  • Each party’s share in the general average should not be determined by fault based approach. The risk borne by all should be equal in all aspects. Though if one of the parties actions has resulted in the loss, legal actions can be taken against those actions
  • Average adjusters are individuals or institutions looking after claims arising due to general average. The parties of a general average claim should send a written notice to them within 12 months from the date of termination of the common maritime agreement between the parties involved. If they do not receive this notice the adjusters are entitled to proceed with all available information with them
  • If a vessel or cargo is damaged by water, including damage by beaching or sinking a burning ship in order to extinguish the fire, then that damage shall be countable as general average. Also if a vessel is grounded intentionally for common safety, it excludes damage caused by smoke or heat of fire

cargos-tumbling-down

 

  • If salvage operations are carried out in order to save or prevent the loss of cargo, or to prevent or reduce an environmental damage, the expenditures involved and the remunerations to salvors should be allowed in general average
  • If any vessel has been grounded and the cargo is liable to get damaged, then efforts can be made to refloat the vessel. However if such efforts cause damage to boilers or machinery of the vessel it shall be made as general average
  • The procuring expenses of any cargo, fuel or ship’s stores upon being discharged as per general average act shall be admitted into general average
  • Loss of freight incurred to the owner by due to loss or damage of cargo should be included in general average , however it is important to deduct from it the expenses which would have incurred by the owner  for carriage as they were not actually incurred
  • If cargo is sold in damaged condition, the general average amount is the difference between net sound and net damaged value

SOLAS, MARPOL amendments entered into force on 1 January 2014

SOLAS, MARPOL amendments entered into force on 1 January 2014

ship freefall lifeboat

A number of amendments to the International Convention for the Safety of Life at Sea (SOLAS), the International Convention for the Prevention of Pollution from Ships (MARPOL)  and the 1988 Load Lines Protocol  entered into force or took effect from 1 January 2014.
The amendments cover passenger ship safety (in relation to safe return to port after a flooding casualty); the testing of free-fall lifeboats; minimum safe manning levels;  prohibition of blending onboard; the revised MARPOL Annex III; the United States Caribbean Sea Emission Control Area; and the Winter Seasonal Zone off the southern tip of Africa.

 

2012 May SOLAS amendments
The SOLAS amendments which entered into force on 1 January 2014 include the following:
– amendment to SOLAS regulation II-1/8-1, to introduce a mandatory requirement for new passenger ships for either onboard stability computers or shore-based support, for the purpose of providing operational information to the Master for safe return to port after a flooding casualty;
– amendment to SOLAS regulation III/20.11.2 regarding the testing of free-fall lifeboats, to require that the operational testing of free-fall lifeboat release systems shall be performed either by free-fall launch with only the operating crew on board or by a simulated launching;
– amendment to SOLAS chapter V to add a new regulation V/14 on ships’ manning, to require Administrations, for every ship, to establish appropriate minimum safe manning levels following a transparent procedure, taking into account the guidance adopted by IMO (Assembly resolution A.1047(27) on Principles of minimum safe manning); and issue an appropriate minimum safe manning document or equivalent as evidence of the minimum safe manning considered necessary;
– amendment to SOLAS chapter VI to add a new regulation VI/5-2, to prohibit the blending of bulk liquid cargoes during the sea voyage and to prohibit production processes on board ships;
– amendment to SOLAS chapter VII to replace regulation 4 on documents, covering transport information relating to the carriage of dangerous goods in packaged form and the container/vehicle packing certificate; and
– amendment to SOLAS regulation XI-1/2 on enhanced surveys, to make mandatory the International Code on the Enhanced Programme of Inspections during Surveys of Bulk Carriers and Oil Tankers, 2011 (2011 ESP Code, resolution A.1049(27)).
2010 October MARPOL amendments
The amendments which entered into force on 1 January 2014 include a revised MARPOL Annex III Regulations for the prevention of pollution by harmful substances carried by sea in packaged form, to include changes to the Annex to coincide with the next update of the mandatory International Maritime Dangerous Goods (IMDG) Code, specifying that goods should be shipped in accordance with relevant provisions.
United States Caribbean ECA now effective 
The United States Caribbean Sea Emission Control Area (SOx, NOx and PM) came into effect, under MARPOL Annex VI, on 1 January 2014, bringing in stricter controls on emissions of sulphur oxide (SOx), nitrogen oxide (NOx) and particulate matter for ships trading in certain waters adjacent to the coasts of Puerto Rico and the United States Virgin Islands.
The ECA was designated under MARPOL amendments adopted in July 2011. There are now four three designated ECAs in effect globally: the United States Caribbean Sea ECA and the North American ECA; and the sulphur oxide ECAs in the Baltic Sea area and the North Sea area.
(See: MARPOL Annex VI regulation 14)
Coordinates for the Caribbean Sea ECA can be found in Resolution MEPC.202(62).
Winter Seasonal Zone moved south under amendments to LL Protocol
Amendments to regulation 47 of the 1988 Protocol to the International Convention on Load Lines (LL), 1966 to shift the Winter Seasonal Zone off the southern tip of Africa further southward by 50 miles, came into effect on 1 January 2014.

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IMO – the International Maritime Organization – is the United Nations specialized agency with responsibility for the safety and security of shipping and the prevention of marine pollution by ships.

Web site: www.imo.org

 

 

 

Bulk carrier runs aground in Willamette River as Captain faces drinking allegations in court

A freighter vessel broke free from its mooring on the Willamette River and ran aground Tuesday. On the same day its master admitted in court to being drunk while operating the ship.

The Russian captain, Valeriy Sharykin, 62-year-old, was arrested Monday evening after members of the USCG boarded the Maltese bulk carrier Adfines East to do a routine inspection, told Michelle Kerin Assistant U.S. Attorney. They observed signs that captain Sharykin was intoxicated, Kerin stated.

Valeriy Sharykin registered a blood-alcohol level of 0.181 promiles, the prosecutor told, over 4 times the legal limit of 0.04 for an operator of a merchant ship.

Less than 21 hours later, captain Valeriy Sharykin had been arraigned, pleaded guilty to the charge and sentenced to 2 years of probation during that time he might not sail in U.S. waters. He also should pay a US$1,000 fine to the court and US$1,000 fine to a community alcohol treatment facility.

But while Capt. Sharykin was in custody, his crew members were aboard the Adfines East on Tuesday with a full load of grain and ready for departure. That’s when the bulk carrier broke free from its mooring at Terminal 4 on the Willamette River. It is still not clear how it’d happened.

The 620-foot freighter vessel drifted about 1,5 nautical miles downstream and into the Columbia River, stated Petty Officer Curtis Daly of the USCG’s Portland office.

Daly told that the crew members were able to anchor the vessel and start the engines. But as the second-in-command attempted to bring the vessel back to Terminal 4, it ran aground on Davis Bar about a mile north of Kelley Point Park.

With the assistance of tug vessels, the bulk carrier was freed from the bar. The ship was later moored at Upper Anchorage, a spot just west of Hayden Island.

The Coast Guard is currently investigating the accident. Capt. Sharykin’s attorney, Kenneth Lerner, declined to comment.

Shell Launches The First 100% LNG Powered Barge

 

Shell Launches The First 100% LNG Powered Barge

 

Shell has launched the first 100% LNG powered tank barge at a
Christening ceremony attended by Shell CEO Peter Voser at Peters
Shipyards in The Netherlands.

Dr. Grahaeme Henderson, Shell Vice President Shipping & Maritime commented:  “We are thrilled to see this first LNG powered barge in operation. Through innovation, a shared vision and a great deal of dedication, LNG powered barging has become a reality. Shell anticipates a bright future for LNG as a fuel in both coastal and inland shipping as it can help customers meet strict emissions standards such as those that are due to apply on the Rhine.”

Shell Ship

The LNG powered barge, Greenstream, has been built and designed at Peters Shipyards in The Netherlands and will be managed by the Dutch based Interstream Barging (ISB). This is the first of two new LNG powered barges to be chartered by Shell. Greenstream has been launched on schedule and will start operating on the Rhine in the next few weeks.

Greenstream has been designed with many new safety and efficiency features. For example, she has four small efficient engines rather than one large engine as in traditional barges.  This means that power can be varied as less is required to travel downstream than upstream with potential for fuel savings.  These engines will operate at lower frequency than traditional barges, reducing vibration and noise levels which could be advantageous when traveling through populated areas on the Rhine. This new LNG powered barge will operate in The Netherlands, Belgium, Germany and Switzerland.

The launch is part of the longer term development of a new European LNG marine fuel industry with the potential to fuel inland barges, ferries, tugs or even cruise ships.  Shell’s recent acquisition of Gasnor, the Norwegian LNG fuel company, is another example of Shell’s confidence in this sector’s future. In addition, over the next few years Shell will develop two LNG corridors, primarily for the marine industry in the Gulf Coast and Great Lakes areas of North America.

5 Dead After Lifeboat Falls From Cruise Ship During Muster Drill

5 Dead After Lifeboat Falls From Cruise Ship During Muster Drill

5 Dead After Lifeboat Falls From Cruise Ship During Muster Drill

Photo of the lifeboat that fell from the ship earlier this morning.

Photo of the lifeboat that fell from the ship earlier this morning.

(11:17 am) Earlier this morning around 7 am EST, five people were killed and multiple injured while the Thomson Majesty was performing a routine muster drill in the port of Santa Cruz in the Canary Islands.

During the drill, the cable crane of one of the lifeboats snapped, causing the lifeboat to fall more than 60 feet into the water with 8 crew members trapped inside. It appears that these crew members were not secured inside the lifeboat by the time it fell.

Three Indonesians, a Filipino and a Ghanaian were killed, the BBC reports. The injured were all men, two aged 30, and another, a Greek national, was 32-years-old, a statement from the islands’ Emergency and Security Coordination Center said.

(11:51 am) Statement from Thomson Cruises:

“We are aware of an incident involving the ship’s crew on board Thomson Majesty, in La Palma, Canary Islands this afternoon.

We are working closely with the ship owners and managers, Louis Cruises, to determine exactly what has happened and provide assistance to those affected by the incident.”

(1:24 pm) New photo released from the BBC.

lifeboat overturned

(2:08 pm) I have just received the following statement from a spokesperson for Thomson Cruises:

“Thomson Cruises can confirm there was an incident involving the ship’s crew during a safety drill on board Thomson Majesty, in La Palma, Canary Islands today at 11:50am local time.

We can also confirm that there have sadly been five crew fatalities and three crew injuries. One person has been discharged from hospital and we expect the other two people to be released from hospital imminently. Our thoughts are with the families of those involved.

We are working closely with the ship owners and managers, Louis Cruises, to determine exactly what has happened and provide assistance to those affected by the incident. We are also working closely with all relevant authorities and will be co-operating fully with their investigations.”

 More on this tragedy as it develops, stay tuned.

Port Of Gothenburg Prepares for the Largest Container Ships – Triple E Vessels

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Port Of Gothenburg Prepares for the Largest Container Ships – Triple E Vessels

March 12, 2013  By Comments
It has been confirmed that the world’s largest container ships – Triple E – will call at the Port of Gothenburg. The ships, which can carry 18,000 containers, are currently being built at a shipyard in South Korea. The first call will be in August.Test runs have been taking place at the Port of Gothenburg for some time to simulate a call by Maersk Line’s new ship generation, Triple E.“The test runs have proved successful and it is very exciting that what we have simulated will now become a reality. We are ready to welcome this new generation of container ship,” says Magnus Kårestedt, Port of Gothenburg Chief Executive.Maersk

The Port of Gothenburg is one of the few ports in Northern Europe that has fairways that are sufficiently wide and deep and cranes that are sufficiently large to receive Triple E ships. Ships which up to a year or so ago were the largest in the world – Emma Maersk and her sister ships – already call at the port. They can carry 14,000 containers*. These will now be gradually replaced by Triple E ships to service one of the routes between the Port of Gothenburg and the Far East.

The new ships are 400 m long and 59 m wide. The carrying capacity is 18,000 containers. Placed end to end, the load from one single ship would be 110 km in length.

“Increased capacity on deep-sea services between Sweden and Asia is positive for Swedish industry. This is where trade flows are increasing whilst European flows are still reporting a poor rate of growth,” states Magnus Kårestedt.

Exports in Sweden comprise mainly paper, timber products, steel and industrial components. Imports largely take the form of clothes, electronics, food, furniture and other consumer products.

Reduced emissions

EEE or Triple E stands for Economy of Scale, Energy efficient och Environmentally improved. The ships will emit half as much carbon dioxide on the Europe/Asia service compared to the average. When the day comes for the ships to be taken out of service, all material can be recycled. The engines and hull are adapted to slow-steaming, i.e. lower speed, which saves fuel.

Thirteen ports

Triple E will call at the following thirteen ports: Gdansk (Poland)– Århus (Denmark)– Gothenburg – Bremerhaven (Germany) – Rotterdam (Netherlands) – Port Tangiers (Algeria) – Singapore – Yantian (China) – Hong Kong – Kwangyang (South Korea) – Ningbo (China)– Shanghai – Tanjung Pelepas (Malaysia).

Reference & Image Credits: portofgothenburg