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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, 09 September 14
WEAK M&A DESPITE ABUNDANT DISTRESSED INDONESIA COAL ASSETS - FITCH RATINGS
COALspot.com: Fitch Ratings says that a meaningful level of merger and acquisition (M&A) activity leading to a consolidation of the coal sector ...
Tuesday, 09 September 14
PORT OF NEWCASTLE SHIPPED 13.207 MTN OF COAL IN AUGUST; TRADE VALUE AROUND $1.17 BILLION
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port, has shipped $1.17 billio ...
Monday, 08 September 14
SUB-BIT FOB INDONESIA COAL SWAP UNDERPERFORMED LAST WEEK
COALspot.com: Indonesian coal swaps for average October 2014 decreased US$ 0.20 (-0.39%) day on day and US$ 1.60 (-3.04%) per mt week on week. The ...
Monday, 08 September 14
API 8 CFR SOUTH CHINA COAL SWAP FOR DELIVERY JAN'15 CLOSED AT US$ 66.30 PMT W/E 5 SEPTEMBER 2014; LOST 5.15% M-O-M
COALspot.com: API 8 CFR South China Coal swap for delivery in October 2014 decreased US$ 0.15 (-0.23%) day on day and US$ 2.05 (-3.04%) week on wee ...
Monday, 08 September 14
CHINESE IRON ORE IMPORT DEMAND VERY STRONG - COMMODORE
COALspot.com: 30 dry bulk vessels were chartered in the spot iron ore market last week to haul iron ore import cargoes to Chinese buyers.
Acco ...
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- India Bulls Power Limited - India
- Ind-Barath Power Infra Limited - India
- Kobexindo Tractors - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- Singapore Mercantile Exchange
- Tata Chemicals Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Aboitiz Power Corporation - Philippines
- Coal and Oil Company - UAE
- Renaissance Capital - South Africa
- Planning Commission, India
- Vijayanagar Sugar Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Mineral Development Corp Ltd - India
- GAC Shipping (India) Pvt Ltd
- Bahari Cakrawala Sebuku - Indonesia
- Marubeni Corporation - India
- Bayan Resources Tbk. - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Coastal Gujarat Power Limited - India
- Minerals Council of Australia
- Port Waratah Coal Services - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Chettinad Cement Corporation Ltd - India
- Sakthi Sugars Limited - India
- Mjunction Services Limited - India
- Kapuas Tunggal Persada - Indonesia
- Central Java Power - Indonesia
- Latin American Coal - Colombia
- Wilmar Investment Holdings
- Power Finance Corporation Ltd., India
- Economic Council, Georgia
- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Lanco Infratech Ltd - India
- European Bulk Services B.V. - Netherlands
- Ambuja Cements Ltd - India
- Simpson Spence & Young - Indonesia
- Meenaskhi Energy Private Limited - India
- Eastern Energy - Thailand
- Neyveli Lignite Corporation Ltd, - India
- Jorong Barutama Greston.PT - Indonesia
- Binh Thuan Hamico - Vietnam
- Sojitz Corporation - Japan
- McConnell Dowell - Australia
- Toyota Tsusho Corporation, Japan
- The Treasury - Australian Government
- Aditya Birla Group - India
- PTC India Limited - India
- Karaikal Port Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Parry Sugars Refinery, India
- Medco Energi Mining Internasional
- Ministry of Mines - Canada
- Trasteel International SA, Italy
- Coalindo Energy - Indonesia
- Standard Chartered Bank - UAE
- Iligan Light & Power Inc, Philippines
- Indonesian Coal Mining Association
- Vizag Seaport Private Limited - India
- Rashtriya Ispat Nigam Limited - India
- GMR Energy Limited - India
- White Energy Company Limited
- Altura Mining Limited, Indonesia
- Makarim & Taira - Indonesia
- Bukit Baiduri Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Uttam Galva Steels Limited - India
- Cigading International Bulk Terminal - Indonesia
- Global Business Power Corporation, Philippines
- Orica Australia Pty. Ltd.
- Maheswari Brothers Coal Limited - India
- Sinarmas Energy and Mining - Indonesia
- Chamber of Mines of South Africa
- PowerSource Philippines DevCo
- Bulk Trading Sa - Switzerland
- Manunggal Multi Energi - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Anglo American - United Kingdom
- Savvy Resources Ltd - HongKong
- Bhatia International Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Siam City Cement - Thailand
- Indogreen Group - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Thai Mozambique Logistica
- Deloitte Consulting - India
- Kumho Petrochemical, South Korea
- Larsen & Toubro Limited - India
- CIMB Investment Bank - Malaysia
- TNB Fuel Sdn Bhd - Malaysia
- Siam City Cement PLC, Thailand
- Africa Commodities Group - South Africa
- Electricity Authority, New Zealand
- Jindal Steel & Power Ltd - India
- GVK Power & Infra Limited - India
- Rio Tinto Coal - Australia
- Dalmia Cement Bharat India
- South Luzon Thermal Energy Corporation
- London Commodity Brokers - England
- Bharathi Cement Corporation - India
- Kohat Cement Company Ltd. - Pakistan
- Kaltim Prima Coal - Indonesia
- Independent Power Producers Association of India
- CNBM International Corporation - China
- Therma Luzon, Inc, Philippines
- Thiess Contractors Indonesia
- Kepco SPC Power Corporation, Philippines
- Directorate Of Revenue Intelligence - India
- Agrawal Coal Company - India
- Kartika Selabumi Mining - Indonesia
- Australian Commodity Traders Exchange
- ICICI Bank Limited - India
- LBH Netherlands Bv - Netherlands
- Semirara Mining Corp, Philippines
- Meralco Power Generation, Philippines
- Salva Resources Pvt Ltd - India
- Bhoruka Overseas - Indonesia
- IEA Clean Coal Centre - UK
- Bhushan Steel Limited - India
- Bangladesh Power Developement Board
- Global Green Power PLC Corporation, Philippines
- Indian Oil Corporation Limited
- Malabar Cements Ltd - India
- OPG Power Generation Pvt Ltd - India
- New Zealand Coal & Carbon
- Mintek Dendrill Indonesia
- Central Electricity Authority - India
- Intertek Mineral Services - Indonesia
- Ministry of Transport, Egypt
- Grasim Industreis Ltd - India
- VISA Power Limited - India
- Vedanta Resources Plc - India
- Samtan Co., Ltd - South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Gujarat Sidhee Cement - India
- Sree Jayajothi Cements Limited - India
- Antam Resourcindo - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Sindya Power Generating Company Private Ltd
- Orica Mining Services - Indonesia
- Edison Trading Spa - Italy
- San Jose City I Power Corp, Philippines
- Ministry of Finance - Indonesia
- Energy Development Corp, Philippines
- IHS Mccloskey Coal Group - USA
- Formosa Plastics Group - Taiwan
- Barasentosa Lestari - Indonesia
- Sical Logistics Limited - India
- Madhucon Powers Ltd - India
- Price Waterhouse Coopers - Russia
- Metalloyd Limited - United Kingdom
- Holcim Trading Pte Ltd - Singapore
- Riau Bara Harum - Indonesia
- Globalindo Alam Lestari - Indonesia
- Tamil Nadu electricity Board
- Parliament of New Zealand
- Miang Besar Coal Terminal - Indonesia
- SN Aboitiz Power Inc, Philippines
- Sarangani Energy Corporation, Philippines
- Georgia Ports Authority, United States
- Interocean Group of Companies - India
- Indika Energy - Indonesia
- Star Paper Mills Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Banpu Public Company Limited - Thailand
- Cement Manufacturers Association - India
- Directorate General of MIneral and Coal - Indonesia
- The State Trading Corporation of India Ltd
- Baramulti Group, Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- MS Steel International - UAE
- Kideco Jaya Agung - Indonesia
- Petron Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Krishnapatnam Port Company Ltd. - India
- Eastern Coal Council - USA
- Oldendorff Carriers - Singapore
- Electricity Generating Authority of Thailand
- Wood Mackenzie - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Attock Cement Pakistan Limited
- Karbindo Abesyapradhi - Indoneisa
- Videocon Industries ltd - India
- ASAPP Information Group - India
- AsiaOL BioFuels Corp., Philippines
- SMC Global Power, Philippines
- Carbofer General Trading SA - India
- Alfred C Toepfer International GmbH - Germany
- International Coal Ventures Pvt Ltd - India
- Heidelberg Cement - Germany
- Asmin Koalindo Tuhup - Indonesia
- Xindia Steels Limited - India
- Merrill Lynch Commodities Europe
- The University of Queensland
- Gujarat Electricity Regulatory Commission - India
- Global Coal Blending Company Limited - Australia
- Goldman Sachs - Singapore
- Borneo Indobara - Indonesia
- Mercator Lines Limited - India
- Indian Energy Exchange, India
- Commonwealth Bank - Australia
- Mercuria Energy - Indonesia
- Energy Link Ltd, New Zealand
- Romanian Commodities Exchange
- Straits Asia Resources Limited - Singapore
- Jaiprakash Power Ventures ltd
- SMG Consultants - Indonesia
- Bukit Makmur.PT - Indonesia
- Australian Coal Association
- Essar Steel Hazira Ltd - India
- Indo Tambangraya Megah - Indonesia
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