Feature 1 | TUGS AND SALVAGE


next decade could amount to more than US$3 billion! Clearly, any prospect of reducing this


huge burden deserves serious considera- tion. Aſter all, P&I Clubs are insurance mutuals. Tey act in the mutual interest of their shipowner members. Te ISU maintains that an investment in environ- mental salvage awards would be far outweighed by a reduction in pollution claims costs.


If a test or trial period is


in order to weigh the expected benefits, perhaps that is a sensible and conserva- tive way to evaluate an even more respon- sive and successful result. It is in the public interest that the salvor


Salvors successfully fought the fires in the holds of the 64,401dwt bulk carrier Nina at Singapore’s Eastern Anchorage in September 2004. (Source: The International Salvage Union.)


concern for the protection of our world’s environment. Te salvage industry will continue to


put the case of fresh thinking and open minds on environmental issues. The cost of pollution will almost certainly continue to increase. Just about everything that can be done has been done, from a regulatory standpoint, to prevent accidents. We are now leſt with factors that cannot


be eradicated, primarily natural perils and human error. Salvage is a commer- cial endeavour. As with every such endeavour, it is directed and realised on fair compensation for its productivity. We must review and renew our


approach to environmental salvage services which will inevitably have a positive inf luence on the financial commitment to the salvage business, the deployment of assets, the encouragement of competent personnel, and increased levels of investment. Te salvors’ expectations regarding the


environment are consistent with those parties that they serve, namely; owners and underwriters. A re-directed approach to increase emphasis on environmental issues in a marine casualty does not have to produce a needless and unnecessary increase in salvage costs. Whether it be contract or arbitra- tion, salvors should be rewarded with


18


additional compensation only when significant pollution damage is avoided. Te ISU is looking for a mutually accept- able solution, not a one-sided windfall. If we fail to seize the opportunity to


“Our industry is and has been at the forefront of concern for the protection of our world’s environment.”


accept change, we must expect to pay far more in compensation and cleanup costs over the following decades. Hopefully, by continued discussion and explor- ing alternatives to our current pollution response, a solution will become clear and we will evolve an even better and improved system for protecting our marine environment.


Reducing claims Te potential for savings is significant. In 2004-05 alone, the International Group Clubs paid out over US$300 million in pollution-related claims. On that basis, pollution-related claims costs over the


responds to all casualties capable of causing pollution, even when a satisfac- tory salvage award might not be achieved. To redirect and emphasise the critical importance of immediate response to pollution issues will ensure that the public interest obligation is fulfilled. Tis can only be accomplished with a


contracting mechanism that realises the primary importance of environmental protection and compensation for the benefit conferred. We look forward to exploring these


complex issues with our industry partners. Whether it be LOF, adjusting existing contracting mechanisms, or the institution of new remedies, we believe we can demonstrate that significant benefits will flow from the changes we have proposed. Tere will be less pollution, reduced


pollution claims costs, more equitable sharing of salvage costs, and encourage- ment for the salvor. We do believe that LOF, which has worked successfully for more than 100 years, is a solution worth exploring. By continuing to place upon the salvor


the obligation of risk in order to obtain a reward, combined with the speed of response which LOF provides, we may have the most effective solution staring us in the face. If the shipping and insurance industries fail to seize this opportu- nity, they can expect to pay far more in compensation and clean-up costs over the next decade. I believe, however, that the benefits will become clear in discussion and that they will welcome the chance to take practical measures to reduce that very heavy burden. SBI


Ship & Boat International May/June 2008


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