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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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Friday, 22 August 14
U.S WEEKLY COAL PRODUCTION UP 2.4% WEEK OVER WEEK
COALspot.com – United States the world's second largest coal producer, produced approximately 19.60 million short tons (mmst) of coal in ...
Thursday, 21 August 14
PREDICTIONS FROM VARIOUS SHIPPERS AND MINING INDUSTRY FOR 2ND HALF YEAR AND ESPECIALLY Q4 IS POSITIVE
Handy
The activity has increased in both hemispheres this week and we see rates edging up on all trades. TA´s are now paying around 8k whic ...
Thursday, 21 August 14
SHIP OWNERS KEEP SHYING AWAY FOR NEW SHIP INVESTMENTS, OVERALL TREND IS DOWN - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
Ship owners have remained in the sidelines of the Sale & Purchasing market for second hand vessels, during most of August, while they also slow ...
Wednesday, 20 August 14
DRY BULK MARKET TO REBOUND IN THE FOURTH QUARTER, OR NOT....- NIKOS ROUSSANOGLOU, HELLENIC SHIPPING
The projected rebound of the dry bulk market is still an elusive trend and shipbrokers and analysts are looking to identify the timing of the loomi ...
Monday, 18 August 14
CAPESIZE RATES TO RISE TO MUCH HIGHER LEVELS THIS YEAR - JEFFREY LANDSBERG
COALspot.com: Capesize rates ended last week at $15,561/day, which marked a week-on-week increase of $6,167 (66%). Capesize rates have been a ...
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- Sojitz Corporation - Japan
- Metalloyd Limited - United Kingdom
- Central Electricity Authority - India
- Kobexindo Tractors - Indoneisa
- Bukit Makmur.PT - Indonesia
- Coal and Oil Company - UAE
- Formosa Plastics Group - Taiwan
- AsiaOL BioFuels Corp., Philippines
- PNOC Exploration Corporation - Philippines
- Billiton Holdings Pty Ltd - Australia
- Electricity Generating Authority of Thailand
- Semirara Mining and Power Corporation, Philippines
- Ambuja Cements Ltd - India
- Bulk Trading Sa - Switzerland
- ASAPP Information Group - India
- Meenaskhi Energy Private Limited - India
- Kideco Jaya Agung - Indonesia
- New Zealand Coal & Carbon
- Neyveli Lignite Corporation Ltd, - India
- GMR Energy Limited - India
- ICICI Bank Limited - India
- The State Trading Corporation of India Ltd
- The University of Queensland
- Kapuas Tunggal Persada - Indonesia
- Port Waratah Coal Services - Australia
- Thiess Contractors Indonesia
- Ministry of Mines - Canada
- Videocon Industries ltd - India
- CNBM International Corporation - China
- Baramulti Group, Indonesia
- Georgia Ports Authority, United States
- Semirara Mining Corp, Philippines
- IHS Mccloskey Coal Group - USA
- European Bulk Services B.V. - Netherlands
- Petron Corporation, Philippines
- Lanco Infratech Ltd - India
- Therma Luzon, Inc, Philippines
- Maheswari Brothers Coal Limited - India
- Central Java Power - Indonesia
- Aboitiz Power Corporation - Philippines
- Merrill Lynch Commodities Europe
- Romanian Commodities Exchange
- GAC Shipping (India) Pvt Ltd
- Chettinad Cement Corporation Ltd - India
- Bukit Baiduri Energy - Indonesia
- Barasentosa Lestari - Indonesia
- Star Paper Mills Limited - India
- Africa Commodities Group - South Africa
- PetroVietnam Power Coal Import and Supply Company
- Mjunction Services Limited - India
- Marubeni Corporation - India
- Kumho Petrochemical, South Korea
- Thai Mozambique Logistica
- Indian Energy Exchange, India
- Indika Energy - Indonesia
- LBH Netherlands Bv - Netherlands
- Bayan Resources Tbk. - Indonesia
- Straits Asia Resources Limited - Singapore
- Gujarat Sidhee Cement - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Directorate General of MIneral and Coal - Indonesia
- Medco Energi Mining Internasional
- McConnell Dowell - Australia
- Salva Resources Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Kepco SPC Power Corporation, Philippines
- Cement Manufacturers Association - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Gujarat Mineral Development Corp Ltd - India
- Wilmar Investment Holdings
- Kaltim Prima Coal - Indonesia
- Indian Oil Corporation Limited
- Economic Council, Georgia
- Tamil Nadu electricity Board
- Vijayanagar Sugar Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Bhatia International Limited - India
- Krishnapatnam Port Company Ltd. - India
- Indogreen Group - Indonesia
- GVK Power & Infra Limited - India
- Miang Besar Coal Terminal - Indonesia
- Timah Investasi Mineral - Indoneisa
- Vedanta Resources Plc - India
- Jorong Barutama Greston.PT - Indonesia
- Australian Coal Association
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bhoruka Overseas - Indonesia
- Trasteel International SA, Italy
- Deloitte Consulting - India
- Coastal Gujarat Power Limited - India
- Ind-Barath Power Infra Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Maharashtra Electricity Regulatory Commission - India
- Sical Logistics Limited - India
- Price Waterhouse Coopers - Russia
- Orica Mining Services - Indonesia
- Indo Tambangraya Megah - Indonesia
- Jaiprakash Power Ventures ltd
- SMG Consultants - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Oldendorff Carriers - Singapore
- South Luzon Thermal Energy Corporation
- Kartika Selabumi Mining - Indonesia
- Minerals Council of Australia
- Bharathi Cement Corporation - India
- Siam City Cement - Thailand
- GN Power Mariveles Coal Plant, Philippines
- Leighton Contractors Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Manunggal Multi Energi - Indonesia
- Independent Power Producers Association of India
- Sindya Power Generating Company Private Ltd
- Power Finance Corporation Ltd., India
- Global Coal Blending Company Limited - Australia
- Globalindo Alam Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Ministry of Transport, Egypt
- The Treasury - Australian Government
- India Bulls Power Limited - India
- Essar Steel Hazira Ltd - India
- Eastern Energy - Thailand
- Goldman Sachs - Singapore
- Malabar Cements Ltd - India
- Pendopo Energi Batubara - Indonesia
- Karaikal Port Pvt Ltd - India
- Energy Development Corp, Philippines
- London Commodity Brokers - England
- Coalindo Energy - Indonesia
- MS Steel International - UAE
- Binh Thuan Hamico - Vietnam
- Xindia Steels Limited - India
- Siam City Cement PLC, Thailand
- CIMB Investment Bank - Malaysia
- Chamber of Mines of South Africa
- Iligan Light & Power Inc, Philippines
- Alfred C Toepfer International GmbH - Germany
- Parliament of New Zealand
- Posco Energy - South Korea
- Tata Chemicals Ltd - India
- VISA Power Limited - India
- Anglo American - United Kingdom
- Carbofer General Trading SA - India
- Sree Jayajothi Cements Limited - India
- Ceylon Electricity Board - Sri Lanka
- Banpu Public Company Limited - Thailand
- Standard Chartered Bank - UAE
- Vizag Seaport Private Limited - India
- Samtan Co., Ltd - South Korea
- Sinarmas Energy and Mining - Indonesia
- Commonwealth Bank - Australia
- White Energy Company Limited
- SMC Global Power, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Sakthi Sugars Limited - India
- International Coal Ventures Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Electricity Authority, New Zealand
- Antam Resourcindo - Indonesia
- Riau Bara Harum - Indonesia
- Orica Australia Pty. Ltd.
- Bukit Asam (Persero) Tbk - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Borneo Indobara - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Parry Sugars Refinery, India
- Ministry of Finance - Indonesia
- Bangladesh Power Developement Board
- IEA Clean Coal Centre - UK
- San Jose City I Power Corp, Philippines
- Madhucon Powers Ltd - India
- Edison Trading Spa - Italy
- Dalmia Cement Bharat India
- Simpson Spence & Young - Indonesia
- Mercator Lines Limited - India
- Singapore Mercantile Exchange
- Agrawal Coal Company - India
- TeaM Sual Corporation - Philippines
- Grasim Industreis Ltd - India
- Meralco Power Generation, Philippines
- SN Aboitiz Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Rashtriya Ispat Nigam Limited - India
- OPG Power Generation Pvt Ltd - India
- Makarim & Taira - Indonesia
- Indonesian Coal Mining Association
- Heidelberg Cement - Germany
- Wood Mackenzie - Singapore
- Aditya Birla Group - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bank of Tokyo Mitsubishi UFJ Ltd
- PTC India Limited - India
- Interocean Group of Companies - India
- Kalimantan Lumbung Energi - Indonesia
- Directorate Of Revenue Intelligence - India
- Savvy Resources Ltd - HongKong
- Energy Link Ltd, New Zealand
- Renaissance Capital - South Africa
- Sarangani Energy Corporation, Philippines
- Bhushan Steel Limited - India
- Australian Commodity Traders Exchange
- Mercuria Energy - Indonesia
- Latin American Coal - Colombia
- Uttam Galva Steels Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Global Business Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Planning Commission, India
- Attock Cement Pakistan Limited
- Rio Tinto Coal - Australia
- Global Green Power PLC Corporation, Philippines
- Larsen & Toubro Limited - India
- Eastern Coal Council - USA
- PowerSource Philippines DevCo
- Jindal Steel & Power Ltd - India
- Mintek Dendrill Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
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