As the quality of bunker fuel continues to be a source of concern to shipowners and charterers, the UK Defence Club has published a guide with procedures that should be adopted in order to reduce the chances of fuel-related engine damage.
Furthermore, the Bunkers: A Guide to Quality and Quantity Claims publication also highlight steps that can be taken to minimise the likelihood of bunker quantity claims and review some of the key legal principles relating to the supply of bunkers.
- Damage caused to ship’s engines from poor quality bunkers can be very costly, not only in terms of repair costs, but also de-bunkering costs and the loss of time incurred in dealing with the problem.
- There are a number of practical steps which can be taken, as presented in the guide, to try to minimise the problems that can arise.
- Bunker claims tend to involve either claims made by suppliers for unpaid bunkers or claims brought under a charterparty or a supply contract for engine damage and other expenses or loss of time caused by the provision of off-specification bunkers. In addition, under-performance claims can arise. These types of claims generally fall within the scope of the Club’s cover.
- In the event that a bunker claim arises, the early involvement of the Club is crucial. This is in order that an appropriate expert can be appointed to preserve all available evidence, so that any short time bars can be complied with and so that the Member can benefit from the considerable experience and expertise that the Club has to offer in dealing with bunker related claims.
The phenomenon
Over the last 40 years or so, enhanced refining techniques have resulted in a decline in the quality of residual fuel. Unfortunately, some marine fuels have also been used as a dumping ground for waste chemicals and organic substances that are suspected to have caused serious operating problems.
… the UK Defence Club explained in its statement
Added to this the global switch to low sulphur fuel in 2020 has resulted in heavy blending and quality issues occur all too frequently. Every year there are isolated incidents of fuel supplied with high levels of catalytic fines, high total sediment and low flash point and the blending of different “renewable” components into fuels appears to be increasing, the UK Defence Club supplied.
There have also been larger-scale contamination incidents, which are often identified when a number of ships suffer similar types of machinery damage as a result of fuel supplied in the same region, the insurer added.
Mitigation measures
The Guide also presents some mitigation measures. Steps which may be said to be taken in mitigation may include de-bunkering any contaminated bunkers or taking steps to treat or manage the bunkers in some way so that they can be safely burnt. Where bunkers have been supplied by the charterer, the owner will invariably seek to have the charterer arrange and pay for the de-bunkering operation.
However, if the charterer denies liability and refuses, the owner should in mitigation consider arranging de-bunkering itself and claiming the cost from the charterer at a later date. This is especially important where the ship may be delayed waiting for the charterer to reach a decision on de-bunkering.
It may be possible to mitigate losses by selling the fuel, possibly as slops for refining. However, an owner will need to bear in mind that the bunkers are the property of the charterer.
