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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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Sunday, 03 August 14
LACK OF COAL SHIPMENTS FROM FAR EAST/SE ASIA, THE PRESSURE ON CHARTER RATES CONTINUED THIS WEEK
COALspot.com: This week, the freight rates were almost flat as charter rates were also almost steady from last week.
The BDI was up by 2.59 pc ...
Friday, 01 August 14
UNCERTAINTY IN ASIAN COAL MARKETS WHERE INDEX-LINKED PRICING DOMINATES - SGX
COALspot.com: In the past 3 years, seaborne thermal coal markets have been in a state of constant oversupply.
Reuters expects this oversupply ...
Friday, 01 August 14
U.S PRODUCED 19.4 MMST OF COAL IN A WEEK, SAYS EIA
COALspot.com – United States the world's second largest coal producer, produced approximately 19.40 million short tons (mmst) of coal in ...
Thursday, 31 July 14
CAPESIZE: CARGO VOLUMES, COAL IN PARTICULAR, PRESENTLY NOT SUFFICIENT TO EMPLOY A GROWING FLEET - FERNLEYS
Handy
Both the Atlantic and Pacific has improved in the supramax segment over the last week, said Fernleys in Its latest weekly report . There we ...
Thursday, 31 July 14
RIO TINTO SELLS MOZAMBIQUE COAL ASSETS FOR US$ 50 MILLION TO INDIA'S ICVL
COALspot.com: Rio Tinto has agreed to sell its Mozambique coal assets for just US$ 50 million to International coal ventures Private limited of Ind ...
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- PTC India Limited - India
- Sinarmas Energy and Mining - Indonesia
- Price Waterhouse Coopers - Russia
- Bangladesh Power Developement Board
- Wood Mackenzie - Singapore
- Sree Jayajothi Cements Limited - India
- Cement Manufacturers Association - India
- Sakthi Sugars Limited - India
- Semirara Mining Corp, Philippines
- Kumho Petrochemical, South Korea
- Bhatia International Limited - India
- Billiton Holdings Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Electricity Generating Authority of Thailand
- CIMB Investment Bank - Malaysia
- Siam City Cement - Thailand
- Indian Oil Corporation Limited
- Maharashtra Electricity Regulatory Commission - India
- Meenaskhi Energy Private Limited - India
- ASAPP Information Group - India
- Bhushan Steel Limited - India
- Indika Energy - Indonesia
- Pendopo Energi Batubara - Indonesia
- Parliament of New Zealand
- Neyveli Lignite Corporation Ltd, - India
- European Bulk Services B.V. - Netherlands
- Eastern Energy - Thailand
- Kartika Selabumi Mining - Indonesia
- Baramulti Group, Indonesia
- New Zealand Coal & Carbon
- Manunggal Multi Energi - Indonesia
- Gujarat Sidhee Cement - India
- Bulk Trading Sa - Switzerland
- GN Power Mariveles Coal Plant, Philippines
- Aditya Birla Group - India
- Maheswari Brothers Coal Limited - India
- Posco Energy - South Korea
- Central Electricity Authority - India
- Makarim & Taira - Indonesia
- Global Business Power Corporation, Philippines
- Electricity Authority, New Zealand
- Agrawal Coal Company - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Formosa Plastics Group - Taiwan
- Mercator Lines Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Mining Services - Indonesia
- Savvy Resources Ltd - HongKong
- Vizag Seaport Private Limited - India
- Siam City Cement PLC, Thailand
- Romanian Commodities Exchange
- Directorate Of Revenue Intelligence - India
- Trasteel International SA, Italy
- Larsen & Toubro Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Coastal Gujarat Power Limited - India
- LBH Netherlands Bv - Netherlands
- Simpson Spence & Young - Indonesia
- Star Paper Mills Limited - India
- Altura Mining Limited, Indonesia
- Anglo American - United Kingdom
- PNOC Exploration Corporation - Philippines
- Singapore Mercantile Exchange
- Thiess Contractors Indonesia
- Planning Commission, India
- Holcim Trading Pte Ltd - Singapore
- Metalloyd Limited - United Kingdom
- Toyota Tsusho Corporation, Japan
- Central Java Power - Indonesia
- Indian Energy Exchange, India
- Lanco Infratech Ltd - India
- Bayan Resources Tbk. - Indonesia
- GVK Power & Infra Limited - India
- Intertek Mineral Services - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Mintek Dendrill Indonesia
- Wilmar Investment Holdings
- Dalmia Cement Bharat India
- Africa Commodities Group - South Africa
- Vedanta Resources Plc - India
- Commonwealth Bank - Australia
- Aboitiz Power Corporation - Philippines
- Meralco Power Generation, Philippines
- Orica Australia Pty. Ltd.
- Karaikal Port Pvt Ltd - India
- Madhucon Powers Ltd - India
- Heidelberg Cement - Germany
- The Treasury - Australian Government
- Port Waratah Coal Services - Australia
- Rio Tinto Coal - Australia
- Minerals Council of Australia
- Eastern Coal Council - USA
- Kapuas Tunggal Persada - Indonesia
- Videocon Industries ltd - India
- Medco Energi Mining Internasional
- Kalimantan Lumbung Energi - Indonesia
- ICICI Bank Limited - India
- Edison Trading Spa - Italy
- Malabar Cements Ltd - India
- Timah Investasi Mineral - Indoneisa
- Cigading International Bulk Terminal - Indonesia
- Banpu Public Company Limited - Thailand
- Mjunction Services Limited - India
- CNBM International Corporation - China
- Uttam Galva Steels Limited - India
- Carbofer General Trading SA - India
- The University of Queensland
- Alfred C Toepfer International GmbH - Germany
- Xindia Steels Limited - India
- Global Green Power PLC Corporation, Philippines
- Jindal Steel & Power Ltd - India
- International Coal Ventures Pvt Ltd - India
- Merrill Lynch Commodities Europe
- MS Steel International - UAE
- Krishnapatnam Port Company Ltd. - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Leighton Contractors Pty Ltd - Australia
- Kaltim Prima Coal - Indonesia
- Indogreen Group - Indonesia
- SMG Consultants - Indonesia
- Latin American Coal - Colombia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ind-Barath Power Infra Limited - India
- GAC Shipping (India) Pvt Ltd
- AsiaOL BioFuels Corp., Philippines
- Directorate General of MIneral and Coal - Indonesia
- Georgia Ports Authority, United States
- IHS Mccloskey Coal Group - USA
- Goldman Sachs - Singapore
- OPG Power Generation Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Sarangani Energy Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Energy Link Ltd, New Zealand
- Therma Luzon, Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Tata Chemicals Ltd - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Transport, Egypt
- Samtan Co., Ltd - South Korea
- Riau Bara Harum - Indonesia
- Kobexindo Tractors - Indoneisa
- PetroVietnam Power Coal Import and Supply Company
- Attock Cement Pakistan Limited
- Karbindo Abesyapradhi - Indoneisa
- Bhoruka Overseas - Indonesia
- Bukit Makmur.PT - Indonesia
- IEA Clean Coal Centre - UK
- Bank of Tokyo Mitsubishi UFJ Ltd
- Globalindo Alam Lestari - Indonesia
- Coalindo Energy - Indonesia
- Antam Resourcindo - Indonesia
- Rashtriya Ispat Nigam Limited - India
- SN Aboitiz Power Inc, Philippines
- McConnell Dowell - Australia
- Economic Council, Georgia
- Ministry of Mines - Canada
- Bahari Cakrawala Sebuku - Indonesia
- Iligan Light & Power Inc, Philippines
- San Jose City I Power Corp, Philippines
- Australian Commodity Traders Exchange
- Coal and Oil Company - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- Interocean Group of Companies - India
- Bukit Baiduri Energy - Indonesia
- Australian Coal Association
- Standard Chartered Bank - UAE
- Vijayanagar Sugar Pvt Ltd - India
- PowerSource Philippines DevCo
- Gujarat Electricity Regulatory Commission - India
- Salva Resources Pvt Ltd - India
- Marubeni Corporation - India
- Grasim Industreis Ltd - India
- Jaiprakash Power Ventures ltd
- GMR Energy Limited - India
- London Commodity Brokers - England
- Mercuria Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Asmin Koalindo Tuhup - Indonesia
- Oldendorff Carriers - Singapore
- Independent Power Producers Association of India
- Ministry of Finance - Indonesia
- Thai Mozambique Logistica
- Power Finance Corporation Ltd., India
- Kideco Jaya Agung - Indonesia
- Parry Sugars Refinery, India
- TeaM Sual Corporation - Philippines
- Bharathi Cement Corporation - India
- Sojitz Corporation - Japan
- VISA Power Limited - India
- Energy Development Corp, Philippines
- Semirara Mining and Power Corporation, Philippines
- Sical Logistics Limited - India
- White Energy Company Limited
- Indonesian Coal Mining Association
- Pipit Mutiara Jaya. PT, Indonesia
- Tamil Nadu electricity Board
- Barasentosa Lestari - Indonesia
- Sindya Power Generating Company Private Ltd
- Straits Asia Resources Limited - Singapore
- Renaissance Capital - South Africa
- SMC Global Power, Philippines
- Miang Besar Coal Terminal - Indonesia
- Borneo Indobara - Indonesia
- Ambuja Cements Ltd - India
- Chamber of Mines of South Africa
- Deloitte Consulting - India
- Global Coal Blending Company Limited - Australia
- The State Trading Corporation of India Ltd
- Indo Tambangraya Megah - Indonesia
- Kepco SPC Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Petron Corporation, Philippines
- India Bulls Power Limited - India
- Essar Steel Hazira Ltd - India
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