World Bunkering > News > Spring 2011 > A reduced liability

You might think that insuring sizeable vessels that are filled with heavy fuel oil and move around the crowded waters of the world’s biggest anchorage and bunkering port, just a few cables off environmentally sensitive tourist beaches, is not for the faint hearted. You would be right.

Actually it turns out that The Shipowners’ P&I Club now insures almost 90% of the bunker tankers operating in Singapore. The Club says its is one of the few mutual insurance groups specialising in insuring bunker tankers. Steve Randall, the club’s general manager & director, Singapore says the mutual liability insurer’s experience is based, in the main, on working with bunker tankers in the port for almost 20 years. He says: “We are now recognised as one of the most knowledgeable players in this field.”

Although it has worked in Singapore for nearly two decades, it was only in 2009 that the Club set up its own office in the port. This was part of its policy to develop representative offices around the world, in order to provide its clients with a 24/7 service in every time zone.

Mr Randall says: “This is a business that suits the Club very well, specialising as it does in insuring vessels generally under 10,000 gt. Effectively, the Club has grown up and matured with the bunkering operators in the port, who now have one of the most modern, stateof- the-art fleets anywhere in the world.”

About 15 years ago things were very different and, he recalls, the Club gave serious consideration to getting out of the Singapore bunkering business altogether. “At that time,” says Mr Randall, “the port’s bunkering vessels did not have to conform to any particular standards of safety of construction, and were mainly of single-screw, single-hull design. The result was a large number of expensive accidents and resulting losses for the Club as insurers.”

Fortunately, the Maritime & Port Authority of Singapore (MPA) appreciated the need to act effectively to tighten construction and safety requirements for bunkering vessels as the bunker business continued to grow strongly. As a result, Category “A” licensed bunker tankers had to be twin-screw driven, be of double-hull construction, and were required to be provided with bow-thrusters and hydraulic booms to support hoses when connected to the receiving vessel. At the same time, the MPA introduced a new code of practice for bunker tankers operating in the port.

Mr Randall says: “The improvements were immediate and marked – to such an extent that there was a rapid turn-around in claims within the space of 12 months. Today’s bunker tankers in the Port of Singapore are mostly around 5,000 gt, are more manoeuvrable than their predecessors, and are equipped with larger and more efficient pumps which allow them to deliver fuel to vessels much more quickly. At the same time, the quality and experience of crews has improved significantly.”

He adds though: “Of course, vessel design and regulation is just one element of the risks involved in bunkering: obviously, a vessel loaded with oil and carrying out complex manoeuvres in confined and crowded waters, carries with it a certain degree of risk, and if anything does go wrong, then there can be serious consequences in environmental terms.”

In reality accidents resulting in pollution from oil spills are relatively few in Singapore these days; the main problems result from navigational error and occasionally other vessels colliding with bunker tankers. Mr Randall notes: “While the masters of local bunker vessels operate purely in Singapore and are therefore well experienced in the navigational foibles of its waters, the masters of visiting vessels are perhaps less familiar with the harbour, and that is where most of the problems occur.”

He tells World Bunkering it is important to realise that the Club works with the bunker fleet operators to reduce risk as well as insuring its clients against it. He concludes: “Through its loss prevention team the Shipowners Club works with members such as the bunker vessel owners, as well as with bodies such as the MPA, to share best practice and to advise on ways to reduce risk, thus keeping claims and insurance premiums as low as possible. It is very much an insurance partnership.”