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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, 13 July 14
PANAMAX INDEX GAINS SLIGHTLY THIS WEEK; CAPE INDEX FALLS ALMOST 21.40%
COALspot.com: This week the freight market fell again after gaining last week. The cape index was down almost 21.40 pct and closed at 1465 points.
...
Friday, 11 July 14
EUROPE HAS A SUBSTANTIAL SURPLUS IN COAL SUPPLIES; RENEWABLE ENERGIES ARE REDUCING THE FULL-LOAD OPERATING HOURS OF HARD COAL-FIRED POWER PLANTS - VDKI
COALspot.com: General conditions for coal-fired power plants must be improved if the energy turnaround is to be a success, said German coal importe ...
Friday, 11 July 14
DR.CIESLIK RE-ELECTED AS CEO OF GERMAN COAL IMPORTER ASSOCIATION (VDKI)
Press Release : Dr Cieslik re-elected as CEO of German Coal Importer Association (VDKi) for the period 2014 – 2018. The German Coal Importer ...
Friday, 11 July 14
PORT OF NEWCASTLE SHIPPED $ 1.031 BILLION WORTH OF 11.744 MILLION TONS OF COAL IN JUNE 2014
COALspot.com: Port of Newcastle has shipped 11,744,396 tons of coal for the month ended 30 June 2014. According to Port’s monthly report, YTD ...
Friday, 11 July 14
UNITED STATE'S MONTHLY COAL OUTPUT FALLS 5.53% IN JUNE
COALspot.com – United States the world's second largest coal producer, produced approximately 18.1 million short tons (mmst) of coal in a ...
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- Electricity Generating Authority of Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kobexindo Tractors - Indoneisa
- Marubeni Corporation - India
- CNBM International Corporation - China
- Dalmia Cement Bharat India
- Bulk Trading Sa - Switzerland
- Orica Mining Services - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Anglo American - United Kingdom
- Coal and Oil Company - UAE
- Krishnapatnam Port Company Ltd. - India
- GVK Power & Infra Limited - India
- Metalloyd Limited - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- Meralco Power Generation, Philippines
- ASAPP Information Group - India
- International Coal Ventures Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Madhucon Powers Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Heidelberg Cement - Germany
- Sinarmas Energy and Mining - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Jorong Barutama Greston.PT - Indonesia
- Riau Bara Harum - Indonesia
- SN Aboitiz Power Inc, Philippines
- Kaltim Prima Coal - Indonesia
- Aboitiz Power Corporation - Philippines
- Energy Development Corp, Philippines
- Parliament of New Zealand
- ICICI Bank Limited - India
- Miang Besar Coal Terminal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Directorate General of MIneral and Coal - Indonesia
- Trasteel International SA, Italy
- Pipit Mutiara Jaya. PT, Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Bhushan Steel Limited - India
- Sree Jayajothi Cements Limited - India
- Planning Commission, India
- Kalimantan Lumbung Energi - Indonesia
- Ambuja Cements Ltd - India
- Singapore Mercantile Exchange
- The Treasury - Australian Government
- Global Coal Blending Company Limited - Australia
- VISA Power Limited - India
- Bukit Baiduri Energy - Indonesia
- Rio Tinto Coal - Australia
- Chettinad Cement Corporation Ltd - India
- Intertek Mineral Services - Indonesia
- Bukit Makmur.PT - Indonesia
- Independent Power Producers Association of India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- European Bulk Services B.V. - Netherlands
- Semirara Mining and Power Corporation, Philippines
- Makarim & Taira - Indonesia
- CIMB Investment Bank - Malaysia
- AsiaOL BioFuels Corp., Philippines
- Directorate Of Revenue Intelligence - India
- Kohat Cement Company Ltd. - Pakistan
- TeaM Sual Corporation - Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Altura Mining Limited, Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Power Finance Corporation Ltd., India
- Meenaskhi Energy Private Limited - India
- Indogreen Group - Indonesia
- Oldendorff Carriers - Singapore
- Straits Asia Resources Limited - Singapore
- Aditya Birla Group - India
- Agrawal Coal Company - India
- Eastern Energy - Thailand
- GN Power Mariveles Coal Plant, Philippines
- White Energy Company Limited
- Bangladesh Power Developement Board
- Cement Manufacturers Association - India
- Formosa Plastics Group - Taiwan
- McConnell Dowell - Australia
- Lanco Infratech Ltd - India
- SMC Global Power, Philippines
- Posco Energy - South Korea
- Indian Energy Exchange, India
- South Luzon Thermal Energy Corporation
- MS Steel International - UAE
- Central Electricity Authority - India
- Larsen & Toubro Limited - India
- Tata Chemicals Ltd - India
- Minerals Council of Australia
- Vijayanagar Sugar Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Economic Council, Georgia
- Bhatia International Limited - India
- Global Business Power Corporation, Philippines
- Samtan Co., Ltd - South Korea
- Essar Steel Hazira Ltd - India
- PowerSource Philippines DevCo
- Australian Coal Association
- Savvy Resources Ltd - HongKong
- Standard Chartered Bank - UAE
- Gujarat Mineral Development Corp Ltd - India
- Renaissance Capital - South Africa
- Africa Commodities Group - South Africa
- Electricity Authority, New Zealand
- Maheswari Brothers Coal Limited - India
- Timah Investasi Mineral - Indoneisa
- Ministry of Finance - Indonesia
- Romanian Commodities Exchange
- Videocon Industries ltd - India
- Coalindo Energy - Indonesia
- Vizag Seaport Private Limited - India
- Barasentosa Lestari - Indonesia
- Deloitte Consulting - India
- Edison Trading Spa - Italy
- Mercator Lines Limited - India
- Xindia Steels Limited - India
- Neyveli Lignite Corporation Ltd, - India
- India Bulls Power Limited - India
- Siam City Cement - Thailand
- Karbindo Abesyapradhi - Indoneisa
- Jindal Steel & Power Ltd - India
- New Zealand Coal & Carbon
- Carbofer General Trading SA - India
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Sidhee Cement - India
- Medco Energi Mining Internasional
- GMR Energy Limited - India
- Holcim Trading Pte Ltd - Singapore
- Indonesian Coal Mining Association
- London Commodity Brokers - England
- Borneo Indobara - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Ind-Barath Power Infra Limited - India
- Goldman Sachs - Singapore
- Therma Luzon, Inc, Philippines
- Bhoruka Overseas - Indonesia
- Baramulti Group, Indonesia
- Australian Commodity Traders Exchange
- PetroVietnam Power Coal Import and Supply Company
- Alfred C Toepfer International GmbH - Germany
- Simpson Spence & Young - Indonesia
- Binh Thuan Hamico - Vietnam
- Latin American Coal - Colombia
- Sakthi Sugars Limited - India
- Thai Mozambique Logistica
- Parry Sugars Refinery, India
- Jaiprakash Power Ventures ltd
- The State Trading Corporation of India Ltd
- Thiess Contractors Indonesia
- Tamil Nadu electricity Board
- Vedanta Resources Plc - India
- Kideco Jaya Agung - Indonesia
- Mjunction Services Limited - India
- Indika Energy - Indonesia
- Central Java Power - Indonesia
- Bharathi Cement Corporation - India
- San Jose City I Power Corp, Philippines
- Indo Tambangraya Megah - Indonesia
- Sojitz Corporation - Japan
- OPG Power Generation Pvt Ltd - India
- Merrill Lynch Commodities Europe
- SMG Consultants - Indonesia
- Coastal Gujarat Power Limited - India
- Antam Resourcindo - Indonesia
- Ministry of Mines - Canada
- LBH Netherlands Bv - Netherlands
- Ceylon Electricity Board - Sri Lanka
- Price Waterhouse Coopers - Russia
- Pendopo Energi Batubara - Indonesia
- Sarangani Energy Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Ministry of Transport, Egypt
- Toyota Tsusho Corporation, Japan
- IHS Mccloskey Coal Group - USA
- Orica Australia Pty. Ltd.
- Banpu Public Company Limited - Thailand
- Iligan Light & Power Inc, Philippines
- Indian Oil Corporation Limited
- Grasim Industreis Ltd - India
- Kepco SPC Power Corporation, Philippines
- Mercuria Energy - Indonesia
- GAC Shipping (India) Pvt Ltd
- Sical Logistics Limited - India
- Salva Resources Pvt Ltd - India
- Petron Corporation, Philippines
- Interocean Group of Companies - India
- Commonwealth Bank - Australia
- Mintek Dendrill Indonesia
- Siam City Cement PLC, Thailand
- Wood Mackenzie - Singapore
- Semirara Mining Corp, Philippines
- Bayan Resources Tbk. - Indonesia
- Attock Cement Pakistan Limited
- Star Paper Mills Limited - India
- Energy Link Ltd, New Zealand
- Sindya Power Generating Company Private Ltd
- Globalindo Alam Lestari - Indonesia
- Kartika Selabumi Mining - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Manunggal Multi Energi - Indonesia
- Wilmar Investment Holdings
- Karaikal Port Pvt Ltd - India
- Malabar Cements Ltd - India
- Port Waratah Coal Services - Australia
- Georgia Ports Authority, United States
- The University of Queensland
- Asmin Koalindo Tuhup - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Chamber of Mines of South Africa
- Offshore Bulk Terminal Pte Ltd, Singapore
- PNOC Exploration Corporation - Philippines
- Kumho Petrochemical, South Korea
- Eastern Coal Council - USA
- Global Green Power PLC Corporation, Philippines
- PTC India Limited - India
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