Regulatory update5 Liquefaction: shippers to develop sampling and testing to control moisture content

The Britannia Steam Ship Insurance Association LimitedRISK WATCH

Volume 24: Number 1

January 2017

In a recent case handled by the Club, a carcarrier completed berthing about 15 minutesbefore low tide. The ship was positioned inaccordance with the instructions of the portpersonnel but it seems that they focussed onmaking sure that the ship was positioned intheir own preferred location for setting downthe ship’s stern side ramp on the berth ratherthan taking into account the position of afender. Nobody on the ship noticed that the

tide was so low that the base of the stern sideramp was directly below a fender and thatthere was a risk of the ship’s hull becomingcaught on the fender when the tide began torise. Several hours later, the inevitablehappened. The ship’s crew managed to adjustthe mooring lines and shift the ship slightlyalong the berth but it was too late and thefender had by then been partially rippedaway from the berth wall.

Navigation and seamanship

1 Fender damage when berthing2 Republic of Congo: limit of territorial waters

3 Fish farms off Lanshan port, PR China

Fender damagewhen berthing

Containers and cargoes4 Cargo damage: inadequate packaging4 Phosphoric acid cargoes from India

When deciding the ship’s berthing position it is important toconsider the location of port property (such as fenders) and howthey are positioned in relation to any protrusions or recesses onthe ship’s hull. It is not just the more obvious parts of the hull suchas the protruding bow flare or bridge wings that should beconsidered, but other less obvious areas.

Pollution6 Oil spills in Brazil – How to avoid small spills becoming large claims

Miscellaneous8 Social media: do not post images of incidents

Loss prevention7 Loss prevention poster campaign: COLREGs 3(f ), 18 and 27(a)

8 Britannia produces bridge operations video

Navigation and seamanship

The master and crew should be aware thatthey are almost always legally responsible forthe handling and berthing position of theship, irrespective of the pilot or shorepersonnel giving guidance or instructions.

A risk assessment should be considered tomake sure that the master and crew areaware of any undesirable locations in relationto port property, such as where fenders might

become damaged by the ship, either duringthe actual berthing or with the changing tide.The master should receive continualobservations and assistance from ship’sofficers at the fore and aft stations during theberthing manoeuvre. A responsible officershould also be tasked to verify that the finalposition is safe in respect of potentialprotrusions on the ship or the berth before‘shutting down’.

A further precaution would be to incorporatevisual reminders on the ship’s hull, such as usingpaint to highlight any areas at risk of beingcaught on fenders and also using signs saying‘no fenders’ near the stern area of the ship.

The Members’ ship had discharged herprevious cargo and was drifting for a few dayssome 50 nautical miles off the coast of theRepublic of Congo while she waited forinstructions. Adverse weather conditionscaused the master to move the ship closerinshore and anchor 23 nautical miles from thenearest coastline. After two weeks at anchorin the same position, to the master’s surprise,two navy war ships appeared and ordered theship to proceed under escort to Pointe Noire.The ship was promptly arrested and four crewmembers, including the master, were broughtashore and detained for interrogation by thelocal authorities (including the Navy andSecret Services) under suspicion of being a‘pirate ship’ or preparing mercenary activities.Negotiations to obtain the release of the crew

were difficult and protracted. The master andthe other three crew members spent twodays in a detention centre and then a furtherweek detained in a local hotel before theywere released.

The master, believing that Congolese territorialwaters only extended to 12 nautical miles, didnot consider there was any requirement tonotify the local authorities of their presence.

While the United Nations Convention on theLaw of the Sea (UNCLOS) sets the limit ofterritorial waters at 12 nautical miles (Art. 3)some states still claim territorial limits greaterthan 12 nautical miles, including the Republicof Congo, which claims a territorial sea of 200nautical miles.

This case serves as an importantreminder of the need to check theapplicable territorial limits to avoidviolating the coastal states’ laws whenanchoring or drifting offshore.

Fender damage when berthing (continued)

Republic of Congo: limit of territorial watersA recent case handled by the Club involved the detention of a shipand crew in West Africa. The case highlights the risk of assuming thatanchoring or drifting beyond the usual 12 nautical mile territoriallimit can be done without approval from the adjoining (littoral) state.

2 Britannia RISK WATCH Volume 24: Number 1: January 2017

In one of the reported incidents, the ship inquestion arrived at Lanshan to discharge itscargo. Having reached safe anchorage off theport, the master received a port guide and amap from the local agent which indicated thefish farm areas. The second officer proceededto plot the designated fish farm areas on theECDIS chart and these updated charts wereused to transit from the anchorage to thedesignated berth. During this transit no radarreflection was detected nor were there anysigns or warnings received from the Lanshanvessel traffic system (VTS) nor from the fishing boats which were allegedly instructedto monitor the fish farms. Less than two days after the ship berthed, an accidentnotice from a fish farm owner was receivedvia local agents.

The incident was investigated, together with other similar reported cases and theinvestigation revealed that most of the shipsinvolved in such incidents had in fact, at somepoint, inadvertently crossed through certifiedfish farming areas and, by implication, had not obtained or taken note of local officialnotices and guidance (although it was alsofound that there were instances where thealleged fish farms were found to be outsidethe designated perimeters). It is common

knowledge that the relevant authoritiesallow these fish farms to be very close to thenavigation channels, posing an additionalrisk to navigation should a ship deviateslightly from the navigational channel.

In some instances there is evidence of thesecertified fish farms not being identified inthe port information supplied by localagents, nor marked in the available charts.Furthermore, all the fish farms involved inthe various incidents were not sufficientlymarked with navigational warnings. Despiteowners of fish farms being obliged to set upadequate warning marks around the farms,often only small flags are utilised, withoutany other indications such as radar reflectors,light buoys, etc. This makes it very difficult todetermine their presence, especially whenvisibility is poor.

Even in circumstances where owners of fishfarms were in breach of their obligation toset up adequate warning, or even when they placed all or part of their fish farms out of their certified designated area, it isvery unlikely that ship owners could escape liability in full as long as it can beproved that the ship deviated from thenavigational channel.

In view of these circumstances, Membersare reminded to exercise caution at alltimes and consider applying amongstothers the following measures:

• When entering and sailing off the portof Lanshan (and subject to othernavigational requirements) to follow thedefined routes without altering courseeven if the charts indicate that the watereither side of the route is clear ofobstructions.

• At the passage planning stage, to seekthe latest information from their localagents, port authorities and VTS on theposition of fish farms.

• To follow the navigation warningsissued by the Maritime SafetyAdministration (MSA) closely and to seek their assistance, especially if theinformation received from agents is in doubt.

• To place an adequate look-out at alltimes and maintain safe navigationspeed appropriate to the risks ofunmarked or inadequately markedfishing nets.

Fish farms off Lanshan port, PR China

The Club continues to be notified of cases involving ships running into fish farms, mostly sub-surfacemussel rafts, off Lanshan Port in Shandong province.

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In a recent case reported to the Club, a consignment of pressure boiler parts was physically damagedduring moderately heavy weather whilst en route from Hong Kong to Houston. The ship encounteredhigh seas and winds of Beaufort scale 9. The master had adjusted speed and course so as to minimiserolling and pitching but despite his actions, inspections carried out by the master in the cargo holdsrevealed the cargo stowed in hold no. 2 had been damaged.

4 Britannia RISK WATCH Volume 24: Number 1: January 2017

Containers and cargoes

Investigating surveyors attended dischargingoperations at Houston to ascertain the natureand extent of the damage. The stowage andsecuring of the cargo was found to be in goodorder and the Cargo Securing Manual (CSM)instructions had been followed. The conclusionwas that the cargo packaging and protection(carried out by the shippers) which consistedof a framework of small dimension steelangles, was found to be insufficient for anocean voyage.

The cargo loading and stowage had beenmonitored by the chief officer throughout theprocess, but he had not paid attention to thepackaging and protection of the cargo. Thedesign of the steel structure and thedimension of the steel structurals (angles)used to protect boiler pipes were clearlyinadequate for the forces to be expected atsea and was clearly designed only toaccommodate inland transportation andshore storage purposes.

The extent of the damage to the stainlesssteel cargo tanks ranges from mild pittingon the tank surface to more extensivecorrosion, causing the tank surface to peeloff as shown in the photographs on theright. Repairs can be labour intensive andtime consuming and there is the additionalrisk of contamination of the cargo beingcarried. To minimise these risks, thefollowing issues should be considered:

Crew knowledge It is important that the crew are familiarwith the type of cargo being carried and thetype of stainless steel within the ship’s tanks.Food grade phosphoric acid is not corrosiveto stainless steel but fertilizer grade acid isfar more aggressive. The crew mustfamiliarise themselves with the SafetyManagement System (SMS) which shouldcontain information on the dangers of

carrying phosphoric acid and includeguidance on the maximum temperature ofthe cargo to be loaded on board.

Tank resistance tablesThe levels of fluoride and chloride, togetherwith the cargo temperature, will influence theextent to which the cargo may react with thestainless steel cargo tanks. Cargo tankresistance tables, usually provided by themanufacturer, provide information on the safetemperature levels for carriage.

Maintain a temperature log on loadingCargo can sometimes be loaded at anexcessive temperature. The crew should beaware of the location of temperature gaugesand monitor the cargo temperature at thebeginning and during loading. If thetemperature is excessive, loading should be stopped.

The shipper is under a duty to package cargoin a manner sufficient to withstand therigours of an ocean voyage. Although themaster(owners) may not be responsibleunder the terms of a charter for stowage andsecuring and the cargo damage resultingtherefrom and will rarely be responsible forthe consequences of inadequate packaging,nevertheless, the master and/or partyresponsible for loading and stowage of suchcargo should endeavour to note theadequacy of packaging/protection for theintended voyage and should put charterersand/or shippers on notice of any obviousconcerns. In any event, the master has a dutyto ensure that cargo is packed and protectedso as to ensure no damage or hazard to theship and other cargo loaded on board canresult from the failure of that packaging.

Cargo damage: inadequate packaging

Phosphoric acid cargoes from India

There have been recent incidents where stainless steel cargo tanks of chemical tankers have beendamaged following the carriage of phosphoric acid cargoes from the east coast of India.

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The objectives of the guidelines are:

• To assist shippers in preparing proceduresfor sampling, testing and controllingmoisture content as required by the IMSBC Code.

• To assist competent authorities atloadports when approving or checking theimplementation of such procedures inaccordance with the IMSBC Code.Liquefaction may occur when the moisturecontent of certain bulk cargoes exceeds thedefined transportable moisture limit (TML).These cargoes are identified as Group Acargo in the IMSBC Code. Therefore, unlessthe ship is designed to carry a liquefiedcargo such as an oil bulk or ore carrier, it isvery important to ensure that the moisturecontent is less than the TML of the cargo.Should solid cargoes liquefy on a normalbulk carrier the results can be catastrophicas the ship will rapidly lose positive stability and can be lost in a very shortperiod of time.

The IMSBC Code sets out to determine bytesting the acceptability of consignmentsfor safe shipment. Thus the IMO hasdeveloped the guidelines for shippersunder MSC .1/Circ. 1454/Rev. 1 to establishprocedures for sampling, testing andcontrolling moisture content. Theseprocedures are to be approved and theirimplementation checked by the competentauthority of the port of loading. Theguidelines outline the requirementsimposed on the shipper and the competentauthority.

The shipperThe shipper is required to develop thefollowing sampling procedures whichinclude identifying the:

• consignment to be sampled

• material (type, particle size, composition)

• time and frequency and place of samples

• method of sampling

• equipment used for sampling

• responsible persons for sampling and their training

• technical supervisor responsible and their training

• records to be kept on training, internalreviews, traceability of subsamples andmaintenance of sampling equipment

The guidelines also set out the requirementsfor testing procedures to be drawn up bythe shipper which should include:

• a description of the adopted testingmethod for determining moisture contentand acceptability of consignment

• a list of the recognised international andnational methods for various materials asreferred to in the IMSBC Code

• a protocol to implement the testingmethod

The testing method must:

• be reproducible

• give compatible results at ship level

• be consistent with feedback

• be capable of providing a safety marginwith respect to liquefaction

• ensure that the moisture content is lessthan the TML

The guidelines also require a procedure tobe drawn up by the shipper for controllingthe moisture content of the cargo. Theimportant thing is to ensure that once themoisture content has been measured itremains below the TML. This procedureshould be based on the factors that mayinfluence the moisture content betweenthe production area and the ship. Theprocedure should address the following :

• geographic configuration of theproduction area

• location of the stockpile

• methods of transport from productionarea to stockpile and then to ship

• precautions to be taken in the stockpiling area

• loading methods from shore to ship andprotection from precipitation

• sampling at different stages of thetransport/storage operation

• procedures for identifying when cargo isnot authorised for loading

• periodic internal controls

• training of personnel involved

• record keeping

The competent authorityThe competent authority of the port ofloading is required to:

• provide an initial verification to theshipper. This must be done before thedocument stating that the shipper’sprocedures have been approved (asrequired by section 4.3.3 of the IMSBCCode) is issued to the master or hisrepresentative. This should ensure that theprocedures comply with the provisions ofthe IMSBC Code and that personnelinvolved have received appropriate training.

• A renewal verification of the shipper’sprocedures at intervals specified by thecompetent authority of the port of loadingbut not exceeding 5 years.

• An intermediate verification before thefirst anniversary of the document requiredby the IMSBC Code.

The competent authority should scrutiniseany changes to the procedures prior toapproval. They should also provide adocument stating that the shipper’sprocedures have been approved after theinitial and renewal verification in accordancewith the IMSBC Code. This document issigned by the competent authority to statethat the procedures outlined in theguidelines MSC.1/Circ. 1454/ Rev. 1 havebeen complied with and a copy of thisdocument should be provided to themaster or his agents in accordance with theIMSBC Code.

It is hoped that the implementation ofthese regulations in the IMSBC Code willhelp prevent further cases of liquefaction.

Liquefaction: shippers to develop sampling and testing to control moisture content

With effect from 1 January 2017 the IMO has introduced a revision to the International Maritime SolidBulk Cargoes (IMSBC) Code on ‘Guidelines for developing and approving procedures for sampling,testing and controlling the moisture content for sold bulk cargoes which may liquefy’.

Regulatory update

In Brazil, the policy of the Federal ProsecutionOffice is to treat small oil spills as seriously aslarge ones because of the perceived potentiallong-term effects. Small spills may result inlarge environmental and ‘moral’ damageclaims which are not commenced until manyyears after the event. Records and informationabout the facts of the case might have beensent to the archives and witnesses may nolonger be available. Therefore, whilst arelatively small claim might appear to be at anend after payment of any fines imposed,closing the file might not, in the longer term,be the correct thing to do.

The advice from Brazilian lawyers Siano &Martins Advogados Associados is to treat asmall spill carefully, even if initially it mayappear logical to close the file after initialpenalties have been paid to authorities andthe clean up costs have been dealt with.There are several specific legal issues whichcreate a problem for ship owners:

• Large civil public actions may be filed,alleging contamination of habitats ororganisms and seeking substantialenvironmental damages. These may befurther increased by the application of’moral’ punitive damages, interest andinflation.

• Recent Brazilian Superior Court of Justicedecisions have held that there is no timebar limitation for civil public actions (basedon the long-term nature of theenvironmental damage).

• It may be possible for prosecutors to claimfor damages to the environment withoutproving loss. This is enabled by theapplication of an exponential formula forthe quantification of claims, produced bythe São Paulo Environmental Authority:Value (US$) = k [10 (4.5 + x)] (commonlyknown as the CETESB formula). (K is thenumber of previous incidents for the party(being k =1 for a first-time spiller, k=2 if it isa second timer, and so on) and x considersthe sum of five variables which are to berated between 0.1 to 0.5: quantity spilled,vulnerability, toxicity, oil persistency, andorganism mortality).

This seemingly arbitrary formula forcalculating a loss is controversial. ITOPF has recently commented that; ‘the basicassumption of theoretical models that arelease of oil will inevitably result in

damage to environmental resources ofa defined nature or scale is scientificallyinaccurate… most notably, the formuladoes not give any consideration toclean-up conducted following anincident. Well managed clean-upoperations invariably accelerate therate of natural recovery of affectedareas and, in doing so, help to mitigatethe impact on the environment’.

It is essential to base the defence ofany such claim on solid evidence,properly preserved. The scientificassessment of material damages to theenvironment will be the best way tochallenge presumed damagescalculated by hypotheticalmathematical models. Actions whichmay need to be undertaken include:

• finding out the potential source orsources of pollutants in the vicinity ofthe incident through field sampling;

• determining the scale and extent ofany pollution release including thenature of any shoreline oiling and thehabitats potentially impacted; and

• investigating the potential impact onlocal fisheries and tourism.

In conclusion, it is recommended thatthe above actions are considered evenfor smaller pollution incidents in Brazil.The costs of focused field surveys andsampling is generally quite modestand such actions may help to avoidliability and also to protect anypotential rights of recovery againstthird parties for what are commonlyvery sizeable environmental damage-related claims.

Oil spills in Brazil – How to avoid small spills becoming large claims

6 Britannia RISK WATCH Volume 24: Number 1: January 2017

Pollution

Despite a great reduction in the number of larger oil spills worldwide, numerous smaller, operationaloil spills occur each year. However, just because a spill is relatively small does not mean it should beconsidered to be less serious: small spills do not necessarily correspond to small claims.

Several ships have recently been questioned for incorrect use of‘not under command’ (NUC) signals whilst drifting and waiting fora pilot to board.

The circumstances illustrated in the poster are;it is dusk and the ship is proceeding in heavytraffic; the red flashing instrument panel alarmnotifies the bridge team that the rudder gearhas failed; the engine room telegraph hasbeen put to ‘stop engines’; the ship is making12.5 knots; NUC lights (two all round redlights in a vertical line) and the port andstarboard sidelights together with the whitestern lights are being displayed. The officer ofthe watch is calling the local coastguard toappraise them of the situation, he alsoexplains his intention to switch off the sternand sidelights (leaving the two all round redlights displayed) when no longer making way.

COLREGs Rule 3 – General definitions – statesthat a ship which is NUC is a ship which, dueto exceptional circumstances, is unable tomanoeuvre as required by these Rules and istherefore unable to keep out of the way ofanother ship. This would be justified as aresult of a main engine or steering gearfailure, or another exceptional cause, butwould not be justified if the ship was merelydrifting whilst waiting for the pilot to board.In the context of a collision between a shipwrongly exhibiting NUC lights or shapes anda power driven ship, administrative actionmay result against the master and/or officerof the watch.

As soon as the main engine, steering gear orother deficiency is repaired the ship shouldturn off NUC lights (or lower the daytimesignal – two black balls in a vertical line) andproceed with normal ‘power driven vessel’lights in accordance with collisionregulation steering and sailing rules for apower driven vessel.

Loss prevention poster campaign: COLREGs 3(f), 18 and 27(a)

Rule 3 General definitionsf ) The term ‘vessel not under command’ meansa vessel which through some exceptionalcircumstance is unable to manoeuvre asrequired by these Rules and is therefore unableto keep out of the way of another vessel.

Rule 18Responsibilities between vesselsExcept where Rules 9,10 and 13 otherwiserequire:

a) A power-driven vessel underway shall keepout of the way of:i) a vessel not under command;ii) a vessel restricted in her ability tomanoeuvre;iii) a vessel engaged in fishing;iv) a sailing vessel.

b) A sailing vessel underway shall keep out ofthe way of:i) a vessel not under command;ii) a vessel restricted in her ability tomanoeuvre;iii) a vessel engaged in fishing.

c) A vessel engaged in fishing when underwayshall, so far as possible, keep out of the way of:i) a vessel not under command;ii) a vessel restricted in her ability tomanoeuvre.

d) (i) Any vessel other than a vessel not undercommand or a vessel restricted in her ability tomanoeuvre shall, if the circumstances of thecase admit, avoid impeding the safe passage ofa vessel constrained by her draught, exhibitingthe signals in Rule 28.ii) A vessel constrained by her draught shallnavigate with particular caution having fullregard to her special condition.

e) A seaplane on the water shall, in general,keep well clear of all vessels and avoidimpeding their navigation. In circumstances,however, where risk of collision exists, she shallcomply with the Rules of this Part.

f ) (i) A WIG craft shall, when taking off, landingand in flight near the surface, keep well clear ofall other vessels and avoid impeding theirnavigation;ii) A WIG craft operating on the water surfaceshall comply with the Rules of this Part as apower-driven vessel.

Rule 27Vessels not under command or restricted intheir ability to manoeuvrea) A vessel not under command shall exhibit:i) two all-round red lights in a vertical linewhere they can best be seen;ii) two balls or similar shapes in a vertical linewhere they can best be seen;iii) when making way through the water, inaddition to the lights prescribed in thisparagraph, sidelights and a stern light.

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Loss prevention

8 Britannia RISK WATCH RISK WATCH is published by The Britannia Steam ShipInsurance Association Limited, and can be found atwww.britanniapandi.com/publications/risk-watch/

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Loss prevention

Miscellaneous

Social media: do not post images of incidents

Britannia produces bridgeoperations video

A recent fire on board a Member’s ship has highlighted the issue of photographs being takenby crew members and being posted on social media sites straight after the incident.

A 22 minute film has been created by Britannia by using a full mission, bridge simulator at WarsashMaritime Academy, Southampton, UK and further films are in production.

In this case, the photographs posted by acrew member were found and used by ashipping media website, which attached theimages to an article giving details of the shipand the incident.

Photographs making their way into the publicdomain can cause difficulties for Membersand the Club in the following ways:

• Cargo interests or charterers can becomeaware of an incident which can lead toincreased requests for lawyers or experts toget access to the ship when it arrives at thenext port of call.

The film is based on a number of incidentsthat have been investigated as part of theClub’s extended root cause analysis intofixed and floating object claims.

The film illustrates the everyday behaviourof a bridge team and their interaction withthird parties during a routine operation thatends in disaster.

Members are invited to integrate this videoand workshop into their own trainingprogrammes. The film is suitable for crew andshore based staff as it raises awareness thateveryone has a role to play in creating a safety culture within their organisation.

Members will be able to watch the film on the Britannia website and can download an

overview for facilitators, including mainlearning points for each of the threemodules and also the film script.www.goo.gl/NFTO1O

If Members would like to receive a copy ofthe film, please email: info@britanniapandi.com

• The images have the potential to prejudicea Member’s position in respect of claimsarising from an incident.

It is recommended that the master requeststhe crew not to take photographs during orafter an incident but if they do, to try to ensurethat the photographs are not uploaded tosocial media platforms where they couldpotentially be used by third parties.