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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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Wednesday, 06 August 14
SHIPPING MARKET INSIGHT - EVA TZIMA
Recent reports that Indonesia’s ban on exports of metal ore concentrates was lifted for the first time in six months for two of its biggest m ...
Wednesday, 06 August 14
SGX SUCCESSFULLY LAUNCHED NEW SGX COAL PRODUCTS
COALspot.com: Singapore Exchange (‘SGX’) has announced that, the exchange has successfully launched its new Coking and Thermal Coal pro ...
Monday, 04 August 14
ANNUAL SECOND HALF SURGE IN BRAZILIAN IRON ORE EXPORTS ABOUT TO BEGIN - JEFFREY LANDSBERG
COALspot.com: Great strength in the capesize market has all along been set to occur during the second half of this year, as that is when Brazilian ...
Monday, 04 August 14
SUB-BIT FOB INDONESIA COAL SWAP INCHES UP DESPITE LOW DEMAND
COALspot.com: Indonesian coal swaps for average Q4’ 2014 increased US$ 0.15 day on day and US$ 0.13 per mt week on week. But, the swap was lo ...
Monday, 04 August 14
Q1' 15 API 8 CFR SOUTH CHINA COAL SWAP CLOSED AT US$ 69.37 ON 1 AUGUST 2014; A $ 1.10 HIGHER COMPARED TO Q4' 2014 CLOSING
COALspot.com: Coal swap prices are showing a positive move upward this past week. API 8 CFR South China Coal swap for Q4, Q1 and Q2 2015 show ...
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- Global Green Power PLC Corporation, Philippines
- Goldman Sachs - Singapore
- Thai Mozambique Logistica
- Aditya Birla Group - India
- Chamber of Mines of South Africa
- Larsen & Toubro Limited - India
- Kohat Cement Company Ltd. - Pakistan
- AsiaOL BioFuels Corp., Philippines
- Ministry of Finance - Indonesia
- Vizag Seaport Private Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Petron Corporation, Philippines
- Ceylon Electricity Board - Sri Lanka
- The Treasury - Australian Government
- Gujarat Electricity Regulatory Commission - India
- Formosa Plastics Group - Taiwan
- Eastern Coal Council - USA
- Sree Jayajothi Cements Limited - India
- CIMB Investment Bank - Malaysia
- Romanian Commodities Exchange
- Meenaskhi Energy Private Limited - India
- Parliament of New Zealand
- Parry Sugars Refinery, India
- Deloitte Consulting - India
- Independent Power Producers Association of India
- Directorate Of Revenue Intelligence - India
- Bangladesh Power Developement Board
- GAC Shipping (India) Pvt Ltd
- Power Finance Corporation Ltd., India
- Renaissance Capital - South Africa
- Cement Manufacturers Association - India
- Semirara Mining Corp, Philippines
- Gujarat Sidhee Cement - India
- Medco Energi Mining Internasional
- PNOC Exploration Corporation - Philippines
- Sical Logistics Limited - India
- Electricity Generating Authority of Thailand
- Binh Thuan Hamico - Vietnam
- Videocon Industries ltd - India
- Kumho Petrochemical, South Korea
- Indonesian Coal Mining Association
- London Commodity Brokers - England
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Kartika Selabumi Mining - Indonesia
- Sojitz Corporation - Japan
- Therma Luzon, Inc, Philippines
- Rashtriya Ispat Nigam Limited - India
- MS Steel International - UAE
- Bahari Cakrawala Sebuku - Indonesia
- Bhatia International Limited - India
- Pendopo Energi Batubara - Indonesia
- Interocean Group of Companies - India
- Intertek Mineral Services - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Bulk Trading Sa - Switzerland
- Ministry of Mines - Canada
- Uttam Galva Steels Limited - India
- Semirara Mining and Power Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Altura Mining Limited, Indonesia
- Jaiprakash Power Ventures ltd
- Neyveli Lignite Corporation Ltd, - India
- Tata Chemicals Ltd - India
- Electricity Authority, New Zealand
- Kapuas Tunggal Persada - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Baramulti Group, Indonesia
- San Jose City I Power Corp, Philippines
- Merrill Lynch Commodities Europe
- European Bulk Services B.V. - Netherlands
- Ministry of Transport, Egypt
- Siam City Cement PLC, Thailand
- Indika Energy - Indonesia
- Africa Commodities Group - South Africa
- IEA Clean Coal Centre - UK
- Karbindo Abesyapradhi - Indoneisa
- Global Coal Blending Company Limited - Australia
- Directorate General of MIneral and Coal - Indonesia
- Jindal Steel & Power Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indogreen Group - Indonesia
- Riau Bara Harum - Indonesia
- Wilmar Investment Holdings
- Salva Resources Pvt Ltd - India
- SMG Consultants - Indonesia
- OPG Power Generation Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Mintek Dendrill Indonesia
- Rio Tinto Coal - Australia
- Mercuria Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- Commonwealth Bank - Australia
- Manunggal Multi Energi - Indonesia
- GVK Power & Infra Limited - India
- Banpu Public Company Limited - Thailand
- Samtan Co., Ltd - South Korea
- Maheswari Brothers Coal Limited - India
- Bhushan Steel Limited - India
- White Energy Company Limited
- Ambuja Cements Ltd - India
- Xindia Steels Limited - India
- Orica Australia Pty. Ltd.
- Anglo American - United Kingdom
- Wood Mackenzie - Singapore
- Global Business Power Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Bayan Resources Tbk. - Indonesia
- Iligan Light & Power Inc, Philippines
- Grasim Industreis Ltd - India
- PTC India Limited - India
- Bukit Makmur.PT - Indonesia
- VISA Power Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Ind-Barath Power Infra Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Barasentosa Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- Mercator Lines Limited - India
- Marubeni Corporation - India
- Simpson Spence & Young - Indonesia
- Kaltim Prima Coal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- IHS Mccloskey Coal Group - USA
- Posco Energy - South Korea
- Chettinad Cement Corporation Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Energy Link Ltd, New Zealand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- ICICI Bank Limited - India
- Australian Coal Association
- McConnell Dowell - Australia
- Jorong Barutama Greston.PT - Indonesia
- Meralco Power Generation, Philippines
- Star Paper Mills Limited - India
- SMC Global Power, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Eastern Energy - Thailand
- Holcim Trading Pte Ltd - Singapore
- New Zealand Coal & Carbon
- Madhucon Powers Ltd - India
- Makarim & Taira - Indonesia
- Planning Commission, India
- Essar Steel Hazira Ltd - India
- Straits Asia Resources Limited - Singapore
- TeaM Sual Corporation - Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Central Electricity Authority - India
- Agrawal Coal Company - India
- Billiton Holdings Pty Ltd - Australia
- Minerals Council of Australia
- Central Java Power - Indonesia
- Economic Council, Georgia
- Attock Cement Pakistan Limited
- Dalmia Cement Bharat India
- SN Aboitiz Power Inc, Philippines
- Indian Oil Corporation Limited
- Orica Mining Services - Indonesia
- Savvy Resources Ltd - HongKong
- Singapore Mercantile Exchange
- Bharathi Cement Corporation - India
- Thiess Contractors Indonesia
- The State Trading Corporation of India Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Energy Exchange, India
- Aboitiz Power Corporation - Philippines
- The University of Queensland
- Cigading International Bulk Terminal - Indonesia
- Coal and Oil Company - UAE
- Lanco Infratech Ltd - India
- Mjunction Services Limited - India
- Vedanta Resources Plc - India
- LBH Netherlands Bv - Netherlands
- Bukit Baiduri Energy - Indonesia
- Sindya Power Generating Company Private Ltd
- Oldendorff Carriers - Singapore
- Bhoruka Overseas - Indonesia
- Price Waterhouse Coopers - Russia
- ASAPP Information Group - India
- Sakthi Sugars Limited - India
- Tamil Nadu electricity Board
- Coalindo Energy - Indonesia
- Trasteel International SA, Italy
- Standard Chartered Bank - UAE
- Petrochimia International Co. Ltd.- Taiwan
- Bank of Tokyo Mitsubishi UFJ Ltd
- Karaikal Port Pvt Ltd - India
- Port Waratah Coal Services - Australia
- Energy Development Corp, Philippines
- Georgia Ports Authority, United States
- Carbofer General Trading SA - India
- GN Power Mariveles Coal Plant, Philippines
- Australian Commodity Traders Exchange
- PowerSource Philippines DevCo
- Maharashtra Electricity Regulatory Commission - India
- India Bulls Power Limited - India
- Heidelberg Cement - Germany
- CNBM International Corporation - China
- Globalindo Alam Lestari - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Sarangani Energy Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Edison Trading Spa - Italy
- Borneo Indobara - Indonesia
- Coastal Gujarat Power Limited - India
- Latin American Coal - Colombia
- South Luzon Thermal Energy Corporation
- Metalloyd Limited - United Kingdom
- Malabar Cements Ltd - India
- Kepco SPC Power Corporation, Philippines
- GMR Energy Limited - India
- Sinarmas Energy and Mining - Indonesia
- Toyota Tsusho Corporation, Japan
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