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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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Thursday, 24 July 14
INDONESIA'S JUNE 2014 COAL EXPORT VOLUME DOWN 6.82%; AVERAGE SELLING PRICE DOWN
COALspot.com: Indonesia, one of the world's largest coal producer and the global leading multi grade coal exporter shipped around $1.70* ...
Thursday, 24 July 14
HANDY: SOUTH AFRICA SOFTENED A BIT, HERE RATES ARE AT AROUND 8K +150K BB FOR TRIPS EAST - FEARNLEYS AS
Handy
The handy market in the Atlantic is going sideways and a tick down on low activity. Levels hoovering around USD 5k on Supras. The SMX marke ...
Thursday, 24 July 14
INDONESIAN COAL EXPORTERS ARE REQUIRED TO OBTAIN ET-BATUBARA UNDER LATEST TRADE MINISTRY'S NEW REGULATION
COALspot.com: Indonesia's trade ministry has issued regulation No. 39/M-DAG/PER/7/2014 which is requires exporters of power plant coal as ...
Wednesday, 23 July 14
PANAMAXES WERE BACK ON A DOWNWARD COURSE; CAPES WERE FEELING THE MOST PRESSURE - INTERMODAL
COALspot.com: The Dry Bulk market was on a downward spiral this week, with the BDI noting another week-on-week decline of the magnitude of 10% this ...
Wednesday, 23 July 14
WEEKLY SHIPPING MARKET INSIGHT - INTERMODAL
In Australia, the world’s largest mining group, BHP Billiton, will beat the iron ore export target of more than 220 million tonnes for 2014. ...
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- Ceylon Electricity Board - Sri Lanka
- MS Steel International - UAE
- LBH Netherlands Bv - Netherlands
- Thai Mozambique Logistica
- Parry Sugars Refinery, India
- Thiess Contractors Indonesia
- Sakthi Sugars Limited - India
- Electricity Authority, New Zealand
- Star Paper Mills Limited - India
- Trasteel International SA, Italy
- Cigading International Bulk Terminal - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Latin American Coal - Colombia
- Dalmia Cement Bharat India
- Tata Chemicals Ltd - India
- Pendopo Energi Batubara - Indonesia
- Samtan Co., Ltd - South Korea
- Baramulti Group, Indonesia
- Siam City Cement PLC, Thailand
- Neyveli Lignite Corporation Ltd, - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Grasim Industreis Ltd - India
- The University of Queensland
- SMC Global Power, Philippines
- Timah Investasi Mineral - Indoneisa
- Barasentosa Lestari - Indonesia
- IHS Mccloskey Coal Group - USA
- Bahari Cakrawala Sebuku - Indonesia
- SMG Consultants - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Malabar Cements Ltd - India
- Borneo Indobara - Indonesia
- Eastern Energy - Thailand
- Standard Chartered Bank - UAE
- Bhoruka Overseas - Indonesia
- Marubeni Corporation - India
- Rashtriya Ispat Nigam Limited - India
- McConnell Dowell - Australia
- Eastern Coal Council - USA
- Mjunction Services Limited - India
- Independent Power Producers Association of India
- International Coal Ventures Pvt Ltd - India
- Indika Energy - Indonesia
- Riau Bara Harum - Indonesia
- Commonwealth Bank - Australia
- Jorong Barutama Greston.PT - Indonesia
- Kideco Jaya Agung - Indonesia
- PNOC Exploration Corporation - Philippines
- Kalimantan Lumbung Energi - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Vedanta Resources Plc - India
- Planning Commission, India
- Coalindo Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Energy Development Corp, Philippines
- Formosa Plastics Group - Taiwan
- Ministry of Transport, Egypt
- Indogreen Group - Indonesia
- Bharathi Cement Corporation - India
- Price Waterhouse Coopers - Russia
- Kumho Petrochemical, South Korea
- Ministry of Finance - Indonesia
- Bukit Baiduri Energy - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Indian Oil Corporation Limited
- Edison Trading Spa - Italy
- Vijayanagar Sugar Pvt Ltd - India
- Siam City Cement - Thailand
- Sical Logistics Limited - India
- Sarangani Energy Corporation, Philippines
- South Luzon Thermal Energy Corporation
- Oldendorff Carriers - Singapore
- Bulk Trading Sa - Switzerland
- Central Java Power - Indonesia
- Videocon Industries ltd - India
- Australian Commodity Traders Exchange
- Sree Jayajothi Cements Limited - India
- Cement Manufacturers Association - India
- Merrill Lynch Commodities Europe
- Meralco Power Generation, Philippines
- Global Coal Blending Company Limited - Australia
- Madhucon Powers Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Agrawal Coal Company - India
- White Energy Company Limited
- Metalloyd Limited - United Kingdom
- Power Finance Corporation Ltd., India
- AsiaOL BioFuels Corp., Philippines
- Medco Energi Mining Internasional
- Jaiprakash Power Ventures ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Gujarat Electricity Regulatory Commission - India
- Tamil Nadu electricity Board
- Electricity Generating Authority of Thailand
- Petron Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Mercator Lines Limited - India
- Sindya Power Generating Company Private Ltd
- Interocean Group of Companies - India
- Gujarat Mineral Development Corp Ltd - India
- Altura Mining Limited, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Australian Coal Association
- Maheswari Brothers Coal Limited - India
- The Treasury - Australian Government
- Bhushan Steel Limited - India
- Indo Tambangraya Megah - Indonesia
- Parliament of New Zealand
- Semirara Mining and Power Corporation, Philippines
- New Zealand Coal & Carbon
- Kaltim Prima Coal - Indonesia
- TeaM Sual Corporation - Philippines
- Indian Energy Exchange, India
- Savvy Resources Ltd - HongKong
- Bayan Resources Tbk. - Indonesia
- Semirara Mining Corp, Philippines
- Ministry of Mines - Canada
- Intertek Mineral Services - Indonesia
- OPG Power Generation Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- Chettinad Cement Corporation Ltd - India
- San Jose City I Power Corp, Philippines
- Leighton Contractors Pty Ltd - Australia
- Directorate Of Revenue Intelligence - India
- GN Power Mariveles Coal Plant, Philippines
- Heidelberg Cement - Germany
- Aditya Birla Group - India
- Kobexindo Tractors - Indoneisa
- Wood Mackenzie - Singapore
- Wilmar Investment Holdings
- Rio Tinto Coal - Australia
- Simpson Spence & Young - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- SN Aboitiz Power Inc, Philippines
- Africa Commodities Group - South Africa
- GVK Power & Infra Limited - India
- Bukit Makmur.PT - Indonesia
- Orica Mining Services - Indonesia
- GMR Energy Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Singapore Mercantile Exchange
- Manunggal Multi Energi - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Bukit Asam (Persero) Tbk - Indonesia
- India Bulls Power Limited - India
- CIMB Investment Bank - Malaysia
- Deloitte Consulting - India
- Economic Council, Georgia
- Iligan Light & Power Inc, Philippines
- Goldman Sachs - Singapore
- Globalindo Alam Lestari - Indonesia
- Energy Link Ltd, New Zealand
- Essar Steel Hazira Ltd - India
- Kartika Selabumi Mining - Indonesia
- Banpu Public Company Limited - Thailand
- The State Trading Corporation of India Ltd
- Kepco SPC Power Corporation, Philippines
- Coal and Oil Company - UAE
- Lanco Infratech Ltd - India
- Bangladesh Power Developement Board
- Central Electricity Authority - India
- Billiton Holdings Pty Ltd - Australia
- Global Business Power Corporation, Philippines
- IEA Clean Coal Centre - UK
- Global Green Power PLC Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Vizag Seaport Private Limited - India
- London Commodity Brokers - England
- ASAPP Information Group - India
- Romanian Commodities Exchange
- Port Waratah Coal Services - Australia
- ICICI Bank Limited - India
- Bhatia International Limited - India
- Renaissance Capital - South Africa
- Indonesian Coal Mining Association
- Carbofer General Trading SA - India
- European Bulk Services B.V. - Netherlands
- Straits Asia Resources Limited - Singapore
- Gujarat Sidhee Cement - India
- Salva Resources Pvt Ltd - India
- Orica Australia Pty. Ltd.
- Chamber of Mines of South Africa
- Xindia Steels Limited - India
- Larsen & Toubro Limited - India
- Attock Cement Pakistan Limited
- CNBM International Corporation - China
- Karaikal Port Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Coastal Gujarat Power Limited - India
- Jindal Steel & Power Ltd - India
- Antam Resourcindo - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Kapuas Tunggal Persada - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Posco Energy - South Korea
- Anglo American - United Kingdom
- Makarim & Taira - Indonesia
- Meenaskhi Energy Private Limited - India
- Mercuria Energy - Indonesia
- Sojitz Corporation - Japan
- PowerSource Philippines DevCo
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Therma Luzon, Inc, Philippines
- Minerals Council of Australia
- PTC India Limited - India
- Uttam Galva Steels Limited - India
- VISA Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Ambuja Cements Ltd - India
- Binh Thuan Hamico - Vietnam
- Alfred C Toepfer International GmbH - Germany
- Georgia Ports Authority, United States
- Mintek Dendrill Indonesia
- Toyota Tsusho Corporation, Japan
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