A significant number of ships have experienced serious operational problems after lifting bunker fuels from the US Gulf region since late March and during April-May, IBIA has also informed.

The principal contaminant has been identified as the phenolic compound 4-Cumyl-Phenol. This compound has adhesive (sticky) characteristics and is commonly used in the manufacture of epoxy resins and pesticides. This has led to clogging of fuel filters onboard vessels and in some cases damage to the engine, the Club stressed.

Notable is that standard testing of fuel in accordance with ISO 8217 will not identify this contaminant and additional specialist testing is required in order to do so. Vessels bunkering fuel at ports in the US Gulf may wish to consider this additional testing when sending the fuel samples to their chosen laboratory.

However, it should be noted that the limited number of laboratories worldwide which are capable of carrying out the additional tests are currently experiencing a significant backlog as a result of the Houston fuel issues. Engineers should pay particular attention to the fuel system and engines when using these fuels and take early action if problems such as fuel pump seizures or filter clogging are noted.

In addition to practical issues, the short time-bar clauses in bunker supply contracts are problematic, particularly in circumstances where there may be a delay between stemming the bunkers in question and starting to burn them, with problems not becoming apparent until that time.

Many contracts require disputes as to the quality or quantity of fuel to be notified to the seller within 30 days of delivery, failing which the claim is deemed waived and time-barred.

Liability caps stipulated in the contracts give rise to further issues. Naturally, the bunker supply contracts which concern stems made in the US Gulf tend to be governed by US law, which will likely recognise and give effect to contractual time bars and liability caps. However, there may be an alternative route available to buyers which circumvents problematic contractual clauses where claims are brought in tort.

In case buyers have concerns about the quality of fuel stemmed prior to burning and prior to the expiration of the time-bar,

....they may wish to consider placing the seller on notice of potential claims arising in relation to the stem. Whilst this may be of assistance in protecting the buyer’s position in relation to the time-bar, so far as we are aware the argument has not yet been tested in the US Courts.