39 minute read
IT’S CLASSIFIED: BULKER CLASSIFICATION IN THE SPOTLIGHT
It’s classified
Bulker classification in the spotlight
Jay Venter
On 16 June this year, Bureau Veritas announced the release of its new structural rules for steel ships, NR467. The new rules are a significant development in classification society standards, building on extensive hydrodynamic simulations as well as unprecedented insight into hydro dynamics and structures, supported by 15 years of new digital tools and increased computing power.
The new NR467 rules, which address the safety requirements for the structural assessment of sea-going ships, replace the rules issued in 2000, and comprise significant changes that will benefit shipyards and shipowners. These include increased clarity and transparency in the parameters used for formulas to support a better understanding of the rules and of the physical phenomena taken into account by shipyards and designers
The advanced concept of Equivalent Design Waves (EDW) was extended to the structural assessment of all types of seagoing ships, taking into account the latest developments in our understanding of key physical processes and hydrodynamics. New hydro-structure coupling tools have been used to validate the choice of the Equivalent Design Waves and the correct combinations of design loads. It is now proven that these waves are sufficient to maximize the structural response at any location on the ship. This improves the definition of loads and scantling requirements, enabling the rules to be more accurate when combined with the associated new formulas and increased computational capabilities for extreme storms and fatigue condition assessments. In tangible terms, this now enables shipyards to improve the distribution of the steel weight, leading to better performance and potential cost savings for shipowners.
Importantly, these new rules harmonize the steel ship rules for all ship types (bulk carriers, tankers, containerships, etc.), providing a consistent framework for designers and shipyards to apply to all vessels. BV has also standardized its rules in line with the International Association of Classification Society (IACS) requirements for all strength matters, such as design principles, the Equivalent Design Wave (EDW) approach and scantling require ments, amongst others.
The development of new BV rules follows a thorough process that begins with Research and Development (R&D) together with industry partners. This is how BV ensures that industry experience informs the development of rules and notations that are aligned with the realities on the ground. BV’s global industry partners are invited to comment on draught rules, before final feedback is sought from a broad range of stakeholders during consultations.
Laurent Leblanc, Senior Vice President Technical & Operations at Bureau Veritas Marine & Offshore, said: “Modern technologies have enabled us to develop modern class rules and standards fit for a fast-evolving shipping industry. Today, we are proud to issue our new Steel Rules, which represent an important milestone in their integration of the latest developments in digital technology, as well as a major tool that will support shipyards and shipowners as they develop the safe, efficient and sustainable fleets that are needed today and tomorrow.
“At BV, we are committed to making our rules as easy as possible for users, without compromising their integrity. We are continuously involved in a wide range of projects, helping us increase our common knowledge together with our stakeholders. Collaboration is vital, and from the earliest stages BV works with industry experts and partners to evaluate and prioritize the needs expressed by our clients. Notations are never fixed in time, and our new Steel Rules are an example of how we continue to refine our rules as technologies progress, research data pours in, and feedback from pilot projects is received.”
SHIPPING & TRANSPORT A new partnership for Bureau Veritas to advance augmented ship services
BV's new SMART notations provide uniform standards for the digital techniques used to enhance fleet performance.
Early in June 2022, ship classification society Bureau Veritas (BV), Laskaridis Shipping and smart tool provider METIS Cyberspace Technology have agreed to embark on a pilot project to develop and apply a new BV SMART 3 Class notation covering the use of augmented data in ship operations.
Modern ships increasingly use smart systems designed to improve their operational efficiency. As part of its strategy to support maritime digitalization, BV has developed a framework of SMART notations for ships which provide consistent and uniform standards for the ‘smart’ techniques used to monitor and improve fleet performance.
In a new ‘Smartship’ pilot project, BV is working with Laskaridis Shipping and METIS to develop a range of additional class notations adapted to the latest advances in digitalization technology, with a focus on the augmented ship. The SMART 3 notation will also cover ship to shore connectivity, remote decision support and remote operations.
Paillette Palaiologou, Vice President for Southeast Europe, Black Sea & Adriatic Zone at Bureau Veritas Marine & Offshore commented: “Digitalization is transforming the maritime industry, bringing new challenges and opportunities. The new range of notations will help advance the journey towards more digitalized and autonomous ships. We are delighted to partner with Laskaridis Shipping and METIS Cyberspace Technology on this new project. Collaboration is essential to help progress new technologies and to support the industry transition.”
Laskaridis Shipping has been at the forefront of applying the advanced realtime monitoring solutions which help to optimize ship efficiency and minimize environmental impacts.
“We are very proud to be a partner in the highly innovative SMART certification project,” said George Christopoulos, Chief Operating Officer, Laskaridis Shipping. “We have committed to being at the forefront of maritime digitalization based on the gains these technologies deliver in operational excellence and enhanced ship sustainability.”
METIS Cyberspace Technology SA specializes in data acquisition, realtime performance monitoring and intelligent analytics for the maritime industry, using machine learning and artificial intelligence.
Mike Konstantinidis, Chief Executive Officer, METIS, commented: “Collaboration in this part of the SMART certification program confirms BV’s recognition of METIS intelligent analytics as fully ready to secure the rewards of shipping’s digital future. We would also like to acknowledge the vital role forward-thinking shipping companies like Laskaridis Shipping play in delivering the true benefits of maritime digitalization.”
Drawing on Bureau Veritas expertise in the certification, implementation and survey of data infrastructure, the new SMART 3 class notation is expected to provide added value for owners, shipyards and manufacturers of digital solutions for the maritime industry.
ClassNK releases comprehensively revised structural rules
Major Classification Society ClassNK released a comprehensively revised version of Part C of its Rules and Guidance for the Survey and Construction of Steel Ships setting the requirements for hull structures on 1 July 2022. ClassNK is constantly revising its Rules and Guidance in order to reflect the latest results from relevant research and development projects, feedback from damage investigations, requests from industry, as well as changes made to the relevant regulations such as international conventions.
Like many other industries, the maritime industry is faced with the challenges of rapid digital technology advances and decarbonization. To support not only various design concepts responding to digitalization and environmental issues but also more flexible hull structure design utilizing innovative technology, ClassNK recently completed a comprehensive revision of its structural rules. They have evolved into data-driven structural rules that incorporate “Design by Analysis” concept throughout them, enabling more rational hull structure design and strength assessment while maintaining sufficient safety.
Following the publication of the rules, information on the comprehensive revision and the rules themselves are available on the ClassNK website.
Norsepower receives financing from Nefco to expand the production of its cleantech solution for the shipping industry
NORSEPOWER’S AUXILIARY WIND PROPULSION SYSTEM CUTS FUEL CONSUMPTION IN VESSELS AND HELPS THE SHIPPING INDUSTRY BECOME MORE SUSTAINABLE — WITH FINANCING FROM NEFCO, THE COMPANY SEEKS GROWTH IN ASIAN MARKETS Nefco, the Nordic Green Bank, has signed a loan agreement with Norsepower Oy Ltd, a Finnish clean-tech company.
Norsepower’s Rotor Sail technology provides efficient, easy-to-use and reliable auxiliary wind propulsion for the shipping industry with installations already onboard tankers, bulkers, RoRo ships and ferries. The technology has a proven average fuel savings record of 5–25%.
“Our mission is to reduce the environmental impact of shipping through the commercialization of innovative and modern sail power. With the International Maritime Organization's (IMO) Energy Efficiency Existing Ship Index (EEXI) and Carbon Intensity Indicator (CII) coming into effect at the start of 2023, Rotor Sails can help ship owners improve their ratings against these criteria to help future-proof their fleet. With Nefco financing, we will be able to invest in our production capabilities in Asia so that we are well-positioned to meet rising demand for our Rotor Sail technology,” says Tuomas Riski, CEO and Partner at Norsepower.
Financing from Nefco will be channelled to investments in the Norsepower production hub in China. Over recent years, Norsepower has established two fully-owned subsidiaries in Hong Kong and Yancheng to respond to the growing demand in Asia. The new financing is a continuation of cooperation with Nefco. The Yancheng subsidiary started with a feasibility study co-financed by Nopef, the Nordic Project Fund, which is a financial instrument managed by Nefco that supports international growth of Nordic SMEs.
NORDIC CLEAN TECHNOLOGY REDUCES ENVIRONMENTAL IMPACT OF SHIPPING With a technology based on the Magnus effect, the patented Norsepower Rotor Sails allow the main engines to be throttled back, saving fuel and reducing emissions while providing the power needed to maintain speed and voyage time. Norsepower Rotor Sails have several patented special features, which ensure their durability, safety, long lifetime, easy operations, and low maintenance costs.
On the environmental side, the Norsepower Rotor Sails contribute to the reduction of greenhouse gases and other emissions, such as sulphur and nitrogen oxides and particulate matter from ships, as each Rotor Sail in operation directly replaces the main propulsion power that is typically derived from fossil fuels. With typical annual fuel savings of 300 tonnes per Rotor Sail, avoided emission reductions are 900 t CO2/a. “This loan agreement is a culmination of our fruitful co-operation with Norse power. Norsepower’s modern sail technology is fascinating, and it offers one solution for the shipping industry that faces increasing cost and environmental constraints,” says Helena Lähteenmäki, Investment Director at Nefco.
Norsepower’s next installation is planned for later this year for CLdN, the logistics specialist for road, sea and rail, onboard a 2018-built RoRo vessel, the Delphine.
Tilting Norsepower Rotor Sails installed onboard VLOC Sea Zhoushan (photo: Norsepower).
Two 35x5m Norsepower Rotor Sails onboard SEA-CARGO's SC Connector, the world's first installation of tiltable Rotor Sails onboard a roro vessel (photo: SEA-CARGO).
It would be a mistake to place responsibility for meeting IMO’s zero emission shipping targets fully on the shoulders of the shipping industry, warns INTERCARGO, as the International Maritime Organization’s Marine Environ ment Protection Committee meeting (IMO's MEPC 78) debates steps to meet IMO ambitions for zero emission shipping by 2050.
Spyros Tarasis, Vice-Chairman of INTERCARGO says: “Global challenges require global solutions, but it must be remembered that the commercial development of these solutions is within the direct control of other stakeholders and not shipowners. Such a target requires a drastic and urgently needed acceleration in the commercial development of the required technologies, fuels, propulsion systems and related infrastructure.
“Whilst INTERCARGO fully supports the drive and the ambition to achieve zero emission shipping by 2050, it urges governments to adopt the necessary measures to accelerate R&D of zerocarbon technologies and expedite their deployment. The net-zero target will only be plausible if governments take the necessary action to achieve this at IMO.”
In order not to jeopardize the 2050 target, INTERCARGO calls for immediate approval of the industry proposal for the establishment of an International Maritime Research and Development Board and an IMO Maritime Research Fund.
In the medium term, it stresses the need for a global levy on carbon emissions from ships as a Market Based Measure, to accelerate the uptake and deployment of zero-carbon technologies and fuels.
INTERCARGO believes that without the above concrete actions, it will be premature to revis e intermediate targets for 2030 or indeed for any subsequent year beyond.
INTERCARGO fully supports the IMO in meeting the shared, global challenge of delivering on the shipping industry’s decarbonization agenda and, in representing dry bulk ship owners, managers and operators, invites IMO to take action as needed.
KR publishes guidelines on vessel storage tank materials for alternative fuels for ships
Korean Register (KR) has published comprehensive guidelines on the metal materials suitable for use in eco-friendly fuel storage tanks, such as those used for storing LNG, ammonia, methanol and hydrogen.
The newly published ‘Guidelines for Selection of Metallic Materials of Containment Systems for Alternative Fuels for Ships’ includes detailed technical information on all the metal materials suitable for such containment systems. It has been jointly developed by KR’s R&D division and Dr. KIM Yongjin’s research team of the Korea Institute of Machinery and Materials (KIMM).
The International Maritime Organization (IMO) intends to regulate the greenhouse gas emissions from existing international ships. As a result, the Energy Efficiency Existing Ship Index (EEXI), the technical requirement to reduce carbon intensity and the Carbon Intensity Indicator (CII), the operational carbon intensity reduction requirements will enter into force from January 2023.
“KR conducts world-class research and development to benefit and support the wider maritime industry, regularly sharing its latest technological information. These timely guidelines will be welcomed by universities, research institutes, shipowners and clients, indeed anyone who is working to develop eco-friendly vessels” says Mr. KIM Daeheon, Executive Vice President of KR R&D division.
In the short term, the global maritime industry is struggling to adopt various strategies such as applying engine power limitation systems, installing energy-saving devices or optimizing navigation routes in order to comply with the greenhouse gas regulations for existing ships.
In the medium to long term however, more vessels will need to use low-carbon or zero-carbon fuels as they offer the most effective way to dramatically reduce greenhouse gas emissions.
As a result, much research is being done to assess and evaluate alternative vessel fuels, particularly ammonia, biogas, hydrogen and methanol.
The systems, methods and materials for storing such fuels onboard vessels are becoming more important too.
KR has proposed suitable metal materials that can be used for containment systems (storage tank) and for the supporting structures taking into account the characteristics of the various ecofriendly alternative fuels.
Applicability evaluation methods and procedures are also included in the document.
The guidelines examine the various restrictions and technical limitations affecting metal materials used to contain liquid hydrogen, which is technically the most difficult to store in large capacities and currently hardly used for vessels as the gaseous hydrogen causes damage to materials.
Lloyd’s Register grants AiP showing 29% reduction on EEDI for SDARI designed Oldendorff Newcastlemax with Anemoi Rotor Sails
Design Index (EEDI) and validated that the newbuild Newcastlemax would have its EEDI score reduced from 1.92 to 1.37 (29% reduction) by installing six 5x30m Rail Rotor Sails and 1.47 (23% reduction) by installing four 5x35m Folding Rotor Sails.
Lloyd’s Register has granted Approval in Principle (AIP) for an SDARI (Shanghai Merchant Ship Design and Research Institute) designed 210,000dwt Newcastlemax bulk carrier installed with Anemoi Rotor Sails to significantly improve efficiency and reduce environmental impact.
The Newcastlemax AIP is part of a pioneering joint development project (JDP), signed in 2020, with Anemoi Marine Technologies, Lloyd’s Register, and SDARI and brings together the OEM, classification society, ship designer, and ship owner to develop a series of energy-efficient vessel designs equipped with Rotor Sails. Oldendorff Carriers is the shipowner partner for this Newcastlemax design
Mark Darley, Global Marine and Offshore Director at Lloyds Register said:
“LR is committed to working together for a safe, sustainable and thriving ocean economy. The fitting of Rotor Sails on this bulk carrier, as part of our JDP with Anemoi, SDARI and Oldendorff Carriers, will considerably improve the vessel’s efficiency and is a clear example of how energy saving devices can support the maritime industry with impending EEXI and CII regulations.”
Director Innovation, Torsten Barenthin, of Oldendorff Carriers commented: “This has been an important project as part of Oldendorff Carriers’ commitment towards Getting to Zero. The results have demonstrated the impressive impact Rotor Sails have on regulatory obligations, which is a key consideration, in addition to the emission reduction benefits. We will continue our assessment of Anemoi’s technology for our fleet.”
The AIP covers the structural integration for a ship design with six 5x30m Rotor Sails and Anemoi’s Rail Deployment System, which sees the Rotor Sails move transversely across the deck to avoid inference with cargo handling; and the structural integration for a ship design with four of Anemoi’s folding (tilting) 5x35m Rotor Sails.
Lloyd’s Register has assessed the calculation used to estimate the impact the Rotor Sails will have on the Energy Efficiency Design Index (EEDI) and validated that the newbuild Newcastlemax would have its EEDI score reduced from 1.92 to 1.37 (29% reduction) by installing six 5x30m Rail Rotor Sails and 1.47 (23% reduction) by installing four 5x35m Folding Rotor Sails.
Nick Contopoulos, Anemoi’s Chief Operating Officer, said: “We’re very pleased with the outcome for the first vessel included in the JDP. EEDI is a significant driver for the installation of Rotor Sail technology and, as we grow closer to the implementation of EEXI and CII, they too become important incentives for Rotor Sails, along with the overarching reductions in fuel consumption and associated emissions. To have the impact pre-validated by LR is a key step in continuing to prove the importance of our technology in the context of the decarbonization of shipping. Both design configurations (folding and rail) of Rotor Sails for a Newcastlemax vessel are available to order now.”
Other vessels included in the JDP and to follow are an 85,000dwt bulk carrier, a very large ore carrier (VLOC), a 114,000dwt Aframax tanker, a 50,000dwt MR tanker and a very large crude carrier (VLCC).
Wang Gang Yi, Chief Engineer of SDARI said: “This collaboration with Anemoi, LR and Oldendorff demonstrates the great potential of Rotor Sail technology to drive significant reduction in emissions and provide ship owners and charterers with available solutions for regulatory compliance, as we move towards 2030 and beyond. We are very pleased to see the market moving and starting to place commercial orders for this renewable technology.”
Rotor Sails are modern mechanical sails comprised of tall cylinders which, when driven to spin, harness the renewable power of the wind to provide auxiliary propulsion to vessels and can reduce overall fuel consumption and lower harmful emissions by 5–30%. The technology can be used in combination with other technologies to further increase efficiency and reduce fuel consumption of all fuel types including incoming future fuels.
This article looks at the insurance implications surrounding the carriage of solid bulk cargoes which may liquefy and how claims arising from liquefaction are typically dealt with.
“In a word, what [the master] was being offered was a wet wolf in a dry sheep’s clothing and there was nothing to put him on notice that the cargo was something radically and fundamentally different from that which it appeared to be. In those circumstances it seems to me that the cargo was dangerous beyond all argument.” — Mr Justice Donaldson, 1968.
So said Mr Justice Donaldson in 1968 when dealing with a case where a master had been misled by shippers about the true moisture content of a cargo of iron ore[1]. In that case, the cargo, although appearing dry during loading, liquefied during the voyage causing the ship to put into a port of refuge and re-stow. The charterer was held responsible for the expenses incurred and for the payment of hire throughout, but the situation could have been much more lethal. It is estimated that more than 100 seafarers have lost their lives following cargo liquefaction. Delays arising from the discovery of cargo liable to liquefy can cost millions of dollars. Claims arising from the loss of a vessel due to liquefaction cost tens of millions of dollars and can cause considerable reputational damage.
WHAT IS LIQUEFACTION? Liquefaction in the context of carriage of goods by sea describes the phenomenon whereby an apparently solid bulk cargo behaves in a manner similar to a fluid. Various mechanisms within the cargo mass contribute to liquefaction, including moisture content, degree of saturation, pressure within the particle pore spaces and the loss of inter-particle frictional force. Liquefaction can occur slowly over time or instantaneously without warning. ‘Dynamic separation’ can occur during a voyage whereby the cargo consolidates at depth, with moisture/fine particles in the cargo forced to the surface, flattening the stow profile and creating a free-surface effect and cargo shift[2].
The process is typically triggered by the exposure of the cargo to cumulative stress from ship motions during a voyage. Once a cargo has begun to liquefy or dynamically separate within the ship’s hold, the process is irreversible, and the ship’s intact stability may be adversely affected. Depending on the cargo and sea conditions, the vessel may capsize.
Typical cargoes affected by liquefaction include nickel ore, iron ore fines, bauxite fines, mineral concentrates and some byproducts such as ‘red mud’, although this list is by no means exhaustive and many other solid bulk cargoes are susceptible to the risk of liquefaction.
INTERNATIONAL LEGAL REGIME The carriage of solid bulk carriages by sea is regulated by the International Maritime Solid Bulk Cargoes (IMSBC) Code. The Code was first adopted by the International Maritime Organization on 04 December 2008 and entered into force on 01 January 2011. It is of mandatory application under the Safety of Life at Sea (SOLAS) Convention and is revised every two years. SOLAS was first adopted in 1914 after the sinking of the Titanic and by the 1960s it was recognized that the IMO should draw up and sponsor an internationally acceptable code of safe practice for the shipment of bulk cargoes. This led to the publication of the Code of Safe Practice for Solid Bulk Cargoes (the ‘BC Code’) in 1965, which was subsequently replaced by the IMSBC Code.
The Code divides a number of solid bulk cargoes into three groups and, when it comes to liquefaction, cargoes fall into either Group A, which consists of cargo which may liquefy, or Group C, which should not. However, a cargo only falls within Group C where it comes within the description, physical properties and characteristics set out in the schedules to the Code. If not, it should be treated as a Group A cargo. Before 2020 for instance, bauxite consisting of a defined particle size was identified as a Group C cargo; bauxite falling outside of those parameters could only safely be treated as cargo which had the potential to liquefy. In the 2020 Edition of the Code, a new schedule was added for bauxite fines (a Group A cargo) where the product contains fine particles such that the moisture in the cargo cannot drain freely.
All IG Clubs require mandatory notification of any intention to load nickel ore from ports in Indonesia and the Philippines so that club managers can provide Members with relevant information to help manage the risks of carriage.
LIQUEFACTION RISK IDENTIFIED DURING LOADING Proper compliance with the Code ought to mean that no solid bulk cargo is at risk of liquefaction during a voyage. However, cargo is often presented by the shippers as safe for shipment, but a risk of liquefaction is subsequently identified during the loading process, often after the crew carry out the complementary test procedure for determining the possibility of liquefaction laid down in the Code (known as a ‘can test’) or due to the involvement of a cargo surveyor. Visual observations of cargo during loading, such seeing splatter on the sides of the hold, often give cause for concern.
Cargoes may have been wrongly presented as safe to load for various reasons, ranging from mistakes during the sampling and testing process to outright fraud by the shipper. Inevitably something has gone wrong on the shore side in such situations since, before presenting a cargo for loading, shippers are under a legal obligation under the Code to correctly identify the proper Bulk Cargo Shipping Name for any solid bulk cargo intended for shipment; determine the properties of that cargo in accordance with approved and suitable sampling and testing procedures; provide the master or his representative with appropriate information in writing sufficiently in advance of loading to enable precautions necessary for safe carriage of the cargo to be put into effect; and, provide a signed declaration in a prescribed form to the effect that the cargo has been fully and accurately described and that the test results are representative of the cargo to be loaded and correct. For a Group A cargo, the cargo declaration should be accompanied by a signed laboratory certificate stating the moisture content of
[1] The Agios Nicolas [1968] 2 Lloyd’s Rep. 57 [2] It is debateable whether dynamic separation and liquefaction are distinct but this article will treat dynamic separation as a type of liquefaction.
the cargo and the Transportable Moisture Limit (TML). The TML is determined as a figure 10% in excess of the product’s flow moisture point (FMP), FMP being the percentage amount of moisture in the product at which, under certain conditions, the cargo may begin to begin to behave like a liquid, or ‘flow’. If the moisture content (MC) of the cargo exceeds the TML then it is not safe or suitable for shipment. The ‘competent authorities’ (port state of departure, port state of arrival and flag state) may authorize an exemption to the Code.
Where a liquefaction risk is only identified during the loading process, it will need to be determined whether loading can continue and whether it is safe for the vessel to sail. The reliability of the information and cargo documents provided by shippers will need to be checked, often requiring visits to stockpiles ashore, further sampling and testing. This will lead to delays and increased costs, which one party to the adventure will ultimately have to pay for. In too many cases, the cargo information and documents were obviously unreliable, for example, if the testing was carried out more than six months prior to the date of loading. Whilst the lack of diligence on the part of the ship in such situations is less than ideal, it is ultimately the responsibility of the shipper to provide a cargo suitable for shipment and any information necessary to ensure safe carriage.
If a carrier is advised that cargo onboard is not safe for shipment, a choice will need to be made whether to have the dangerous cargo removed from the ship, or to try and remediate the situation. In many situations there is no way that cargo once onboard a ship can be physically removed or legally reimported to the country of origin. Remediation may involve waiting for the cargo to dry (sometimes aided by fans) or introducing safe cargo or a drying agent. Such steps need to be taken under the guidance of an appropriate cargo expert. The process can take months, often with no guarantee of success.
Depending on the terms of the contract of carriage or charterparty, the charterer and the shipper are likely to face a claim for the owner’s losses arising from the dangerous nature of the cargo — discussed further below.
Cargo experts might disagree as to when suspect cargo has become safe to carry. In particular, some experts take the cautious view that the ship cannot sail until samples of the cargo have passed one of the tests described in the Code. Other experts may consider that the testing outlined in the Code is rudimentary and only intended to identify potential liquefaction risks prior to sailing and that, once a liquefaction risk has materialized, assessment outside the scope of the Code is permissible to determine whether cargo will in fact liquefy on the voyage. A standoff between experts on the correct approach may be protracted and expensive for the party in the wrong.
Carriers have been known to continue with loading or to sail against the recommendation of cargo experts. The Club then finds itself in the role of a critical friend, understanding of the commercial need to trade without undue delay or additional cost but fairly warning of the potential implications if the ship is put to sea in a dangerous condition. If cargo is not safe to carry, this may prejudice Club cover and other forms of insurance, even where cover is not explicitly reserved. Operational costs arising from ensuring safe loading, even when incurred in anticipation of potential future P&I liabilities, are unlikely to be paid for by the Club.
North has also seen a rise in charterparty terms limiting the carrier’s ability to comply with the Code by, for example, restricting access to stockpiles ashore. The existence and application of such terms are also likely to prejudice cover and are strongly discouraged.
LIQUEFACTION RISK IDENTIFIED DURING VOYAGE Liquefaction may only become apparent for the first time during a voyage and the ship may then have to call at a port of refuge. In some cases, however, the ship will have no better option than to continue to the intended destination.
Cargo experts will be able to advise on the level of risk in continuing the passage and on the steps which can be taken to minimize the danger. In such situations, the additional expenses incurred by the carrier in dealing with the emergency situation will in principle be recoverable in General Average. H&M will pay the ship’s share of GA (with discretionary P&I cover for any shortfall due to under-insurance) subject to the terms of the hull policy. Collection from other interests will depend on the existence of actionable fault on the part of the carrier leading to the incident. If there is an actionable fault defence then, in principle, the unrecoverable GA will be reimbursed by P&I unless the owner knowingly failed to follow the Code or take other prudent precautions to avoid the risk of liquefaction.
LIQUEFACTION CAUSING THE LOSS OF A SHIP The loss of a ship with the death of her crew following liquefaction will lead to various costs falling to P&I and other marine insurances. The loss of the ship itself will fall to H&M. P&I covers claims arising from the loss of cargo; injury or death claims relating to those onboard; wreck removal; and, pollution. Owners may pay for extensive search and rescue costs — either using their own assets or paying for state or private S&R efforts — which would not automatically fall to insurers.
Where P&I cover has been prejudiced because the Member failed to follow the Code or in some other way acted imprudently, the Club will not reimburse Members for losses resulting from cargo claims and people claims. In any event, cargo claims are usually not a major cost arising from a total loss caused by liquefaction. Typically, those cargoes prone
Nickel cargoes are especially vulnerable to liquefaction.
to liquefaction are not very valuable. The claim is also likely to fail where the cargo itself was the cause of the loss[3]. Cargo interests often only recover where loss results from liquefaction by putting undue pressure on carriers to pay an unmeritorious claim.
In the first instance P&I insurers may have to meet certified liabilities in respect of wreck removal operations or pollution costs up to the applicable limits of liability set out in the various international conventions. They will also look to support the dependants of those lost in maritime incidents even in the absence of a direct liability. Clubs will in principle be able to recover such exposures from Members if cover has been compromised.
Owners and their insurers will look to pursue recourse claims against charterers and cargo interests. Typically those claims arise on the basis of the common law obligation not to ship dangerous cargo, under specific charterparty clauses[4] or other express terms in the bill of lading or charterparty. Charterers and cargo interests will often seek to defend such claims either by relying on the burden of proof, by invoking technical construction arguments or by seeking to break the chain of causation. v To discharge its burden of proof, the owner will need to collect evidence showing the cargo liquefied on the voyage. Whilst this can appear daunting at first, it is rarely an insurmountable challenge. Evidence about the true nature of the cargo can usually be obtained following robust investigations. The requirement to show that the preponderance of evidence points towards liquefaction is not onerous. It will be a brave defendant who relies solely on the burden of proof to resist a claim and who therefore declines to put forward any plausible alternative theories to explain the loss of the vessel. Any competing theories can be tested by the judge or by arbitrators according to the evidence; non-liquefaction theories are frequently implausible. Shipper and cargo interests may raise
[3] The claim failing due to a lack of breach of duty by the carrier. Alternatively, to avoid circuity of action where the cargo claimant owned the cargo which liquefied or on the basis that one cannot take advantage of one’s own wrongful conduct. Article IV, rule 2(m) of the Hague-Visby Rules provides a defence to claims arising from inherent vice of cargo, Article IV, rule 2(q) states a carrier is not liable in the absence of fault or neglect on the part of its agents and Article IV, rule 5(h) provides the carrier is not responsible for loss or damage where goods have been knowingly mis-stated by the shipper in the bill of lading. [4] BIMCO’s “Solid Bulk Cargoes that Can Liquefy Clause for Charter Parties” as set out in North’s Recommended Clauses (2021-2022). [5] Article IV, rule 6 [6] The Fiona, The Kapitan Sakharov, The Aconcagua [7] The obligation on a shipper not to load dangerous cargo without the carrier’s informed consent
[8] The obligation on a carrier and its delegates to exercise due diligence ensure a vessel is seaworthy prior to the commencement of a voyage [9] Borealis v. Geogas which determined that the not actionable conduct of a claimant’s agents only breaks the chain of causation where that conduct obliterates the wrongdoing of the defendant.
v
v technical defences to the effect that there was no breach of the Code or of an express warranty, but these arguments usually fail to overcome the well-established common law obligation not to ship dangerous cargo without the informed consent of the carrier or the shipper’s explicit responsibility under the Hague-Visby Rules for all damages and expenses resulting from the shipment of dangerous goods which the carrier has not consented to carry with knowledge of their true nature[5]. Shippers and cargo interests may seek to allege that the ship was unseaworthy, breaking the chain of causation between the charterer/ shipper’s breach in shipping dangerous cargo and the loss. The unseaworthiness complained of often involving an alleged failure of those onboard to detect the liquefaction risk and to prevent carriage. This is presentationally a challenging argument to run. Whilst is it permissible to run alternative legal arguments in English arbitration or court proceedings, a party who produces extensive expert evidence to the effect that the cargo was safe for shipment will then struggle to turn around and argue the reverse that, if that cargo was in fact dangerous, then this should have been obvious to the crew at the time of shipment. It is also a distasteful argument if the crew were killed and are not able to defend their actions. It is legally a difficult argument: whilst the English courts have decided previously[6] that the chain of causation between a claim under Article IV, rule 6 of the HagueVisby Rules[7] or for breach of the common law obligation not to ship dangerous cargo will be broken by a concurrent breach of Article III, rule 1[8], this argument is more likely to succeed where the owners’ breach was a direct cause of the loss of the ship, rather than being a failure to sound the alarm bell that cargo may have been mis-declared, and the defence might not apply to a breach of an express term of the bill of lading or charter in any event. It is unlikely that faults on the part of the vessel falling short of actionable unseaworthiness could ever amount to a defence to a claim[9].
Certain liabilities falling to a charterer as a result of a total loss caused by liquefaction may in principle be covered by charterers P&I cover or by Damage to Hull insurance. There may be gaps in these covers however, such as for charterer’s own loss of earnings, which will be for the charterer’s account unless specialist insurance has been obtained. Cargo interests may have insurance for the same liabilities under a ‘cargo owners legal liability insurance’ policy or similar.
THE FUTURE Whilst the Code benefits from continual evolution so it can meet new issues, properly followed it sets out a workable regime for ensuring the safe ocean transport of solid bulk cargoes in the majority of cases. The real challenges in the carriage of cargoes prone to liquefaction are practical, including lack of testing facilities; stockpile access; cargo surveyor availability; intimidation of seafarers and surveyors; fraud; and, a lack of understanding of the dangers inherent in carriage of solid bulk cargo by stakeholders. Charterers and cargo interests ought to appreciate that the costs arising from a serious incident involving liquefaction are likely to fall on them with only a modest discount to reflect the litigation risk in pursuing a recourse action. by David Richards
Liquefaction of its nickel ore cargoes was believed to be a major factor in the sinking of the Trans Summer in 2013.
Berge Bulk vessels to receive Anemoi Rotor Sails in its move towards a zero-emission fleet
On 13 July, Singapore-based dry bulk owner Berge Bulk announced that it had signed agreements with Anemoi Marine Technologies Ltd — a global expert in wind-assisted propulsion for commercial vessels — to supply and fit two vessels in its dry bulk fleet with Anemoi Rotor Sails.
The first vessel, Berge Neblina, a 388,000dwt Valemax ore carrier built in 2012, was made ‘windready’ earlier this year. The structural integration required prior to installing the technology was carried out during a scheduled dry dock. Four of Anemoi’s large folding deployment Rotor Sails will be installed to improve vessel performance. Folding Rotor Sails can be lowered from the vertical to mitigate the impact on air draught and cargo handling operations.
This flexible ‘wind-ready’ approach has been taken to align with vessel availability and Anemoi’s production slots. The same approach has been taken with the second vessel, Berge Mulhacen, a 2017-built 210,000dwt Newcastlemax bulk carrier, which will also receive four folding Rotor Sails. Plan approval has been obtained for both ships from DNV.
Paolo Tonon, Technical Director at Berge Bulk, said: “We’re committed to continuous innovation and exploring cleaner, greener energy sources. Wind propulsion is an option we have explored previously in other formats, and we firmly believe it can help achieve our decarbonization commitments. The partnership with Anemoi commenced with in-depth engineering simulations to find the best possible technical and commercial solution. Therefore, we are pleased to be rolling out their Rotor Sail technology on our vessels.”
Berge Bulk serves the dry bulk industry with efficient ship design and operations. It is committed to developing and deploying commercially viable deep-sea zeroemission vessels by 2030.
Commenting on the agreement, Kim Diederichsen, CEO of Anemoi Marine Technologies, said: “I’m delighted to be announcing this partnership with Berge Bulk. It is a further confirmation that forward-thinking shipowners are turning to wind-assisted propulsion to help them achieve their environmental objectives — and it proves, once again, that Rotor Sails are a realistic and workable solution that results in significant carbon savings.”
Rotor Sails are large mechanical sails that harness the renewable power of the wind to reduce emissions and fuel consumption on commercial ships when driven to spin. Anemoi predicts that the four-rotor system will save Berge Bulk 1,200–1,500 metric tonnes of fuel per vessel each year.
ABOUT BERGE BULK Berge Bulk is one of the world’s foremost independent dry bulk owners with an outstanding reputation for the safe, efficient, and sustainable delivery of commodities around the world. Berge Bulk is a young and dynamic company with a strong commitment to innovative growth and development. It has committed to be carbon neutral by 2025 at the latest.
Berge Bulk owns and manages a fleet of over 80 vessels, equating to more than 14 million DWT. The fleet ranges from Handysize to Capesize to some of the largest vessels ever built, serving the world’s major miners, steel mills and charterers.
ABOUT ANEMOI Anemoi Marine Technologies is a leading provider of Rotor Sails to the shipping industry. The energy saving technology offers significant reductions in fuel consumption and lowers CO2, SOx and NOx emissions to deliver more efficient ships.
Following extensive research and development, Anemoi has commercialized the product for widespread adoption by the global merchant fleet. With a background in the bulk carrier sector, Anemoi’s patented design addresses operational considerations, proving it can work for the majority of sectors.
Rotor Sails play a key part in addressing industry environmental targets and creating a sustainable future of shipping.
The Rotor Sails are lowered for manoeuvring and cargo operations.
As a short-term measure to reduce GHG emissions from ships, IMO has adopted regulations that will require vessels to improve their energy efficiency from the technical and operational approach.
The technical approach requires a calculation of Energy Efficiency Existing Ship Index (EEXI) from an individual ship. If attained EEXI cannot satisfy the required EEXI stipulated in the regulation, the ship is required to take additional measures such as engine power limitation (EPL), retrofitting energy saving devices, increasing deadweight, etc.
Upon the adoption of the new regulation, ClassNK analysed its register book listing over 9,000 ships and announced that approximately 6,050 ships were required to take measures to be compliant in 2021. Regarding bulk carriers as a segment, 86% of its registry was subject to this action. As of the end of the first half of 2022, the society confirmed 600 ships out of the above figure have been confirmed as compliant, according to the regulatory requirements. Since the EEXI certification is necessary for the first periodical survey in 2023, ClassNK has encouraged early attention and action of shipping companies.
From a cost perspective, EPL is regarded as the most practical means to improve EEXI. In fact, most of the 600 ships mentioned above have applied EPL. While improving EEXI, EPL will lower the maximum ship speed which may have an impact on the vessel operation. Therefore, assessing EEXI and determining the suitable power limitation well in advance is essential. For smooth and efficient compliance, accurate calculation is of the utmost importance, and to support shipowners in achieving this, ClassNK has developed its ‘EEXI simplified planner’. Available on its website, this EEXI compliance tool provides the conservative approximated calculation of a ship’s EEXI by inputting DWT and MCR, and identifying whether the value complies with the regulation. Furthermore, ClassNK’s team of experts are ready to support with the tailored calculations as well as to offer guidance on individual ships within a fleet if required.
The operational approach requires each ship to calculate the annual Carbon Intensity Indicator (CII). CII shows how efficiently a ship has transported cargoes based on IMO DCS data. The attained CII will be compared with the reference line and given a rating in five levels, from ‘A’ being the most efficient and ‘E’ being the least efficient. The required CII will be strengthened by 2% from 2023 to 2026, which means that the rating may go down even if a ship has the same attained CII as in a previous year.
The ships subject to the CII ratings have to develop a ship operational carbon intensity plan (SEEMP Part III), which include CII calculation methodology, required CII values over the next three years, implementation plan for achieving the required CII and procedures for selfevaluation and improvement. ‘ClassNK MRV Portal’, a compliance supporting tool for IMO DCS and regional MRV, provides shipping companies with functionality that reduces the burden of preparing plans to meet such compliance challenges.
Once the CII ratings are implemented, it will be important to analyse the attained CII of the entire fleet and consider the most cost-effective and feasible method to optimize CII. ClassNK’s dedicated team is focused on providing useful information and tools for decision-making related to CII. For example, its recently-released ClassNK ZETA is a solution enabling shipping companies and stakeholders to monitor accurate CO2 emissions and simulate CII ratings. It works by utilizing the data sent from ship management companies to the ClassNK MRV Portal, with no need for additional inputs for calculating CII ratings, and the data processed for regulatory reporting assures accurate outputs.
ClassNK ZETA comprises four key features: Vessel Monitoring, Fleet Monitoring, Simulation, and Periodical Report. Drawing on a vessel’s current operation status, Vessel Monitoring instantly displays the estimated annual CO2 emissions and CII ratings of individual ships for seeking possible actions. Fleet Monitoring shows the same information fleetwide, and allows users to evaluate the impact of emissions-reduction measures by benchmarking against past emissions data. Simulation shows the changes in the CO2 emissions and CII ratings of a vessel or fleet that would occur following the uptake of emissions-reduction measures such as slow steaming, using an energy-saving device, or switching to an alternative fuel. It allows the shipping company to compare the effectiveness of these measures in the context of its vessel or fleet operations. Finally, Periodical Report details the emissions performance of ships and fleets to meet the reporting requirements of stakeholders, including financial institutions, insurers, and cargo owners.
ClassNK ZETA streamlines and simplifies emissions monitoring, simulation, and reporting processes, saving the users’ time, cost, and administrative effort in their endeavours to comply with regulatory requirements and their own initiatives pursuing zero-emission. DCi
