Release for Lumley Brokers: Do your clients have cargo on the MV “Rena”?

The cargo vessel “Rena“ remains stuck fast on Astrolabe Reef, amongst growing fears as to whether she will remain intact long enough for salvors and insurers to remove cargo stored in the 1,700 containers on board.

It has been confirmed that a number of the containers (approximately 70) that were lost overboard on the evening of 11 October were empty. Some have been washed up on Motiti Island.

Professional salvors, including Naval architects, are currently assessing damage to the ship using aerial photographs. When the weather allows, the intention is to offload as many containers as possible to Tauranga so that Rena may be secured against further loss of bunker oil and cargo.

This will all take time and as at the release of this notice the vessel owners have not yet declared a General Average (GA). However as a Total Loss is now more likely a GA may not be warranted.

In addition to the value of the cargo lost, there will be significant costs incurred by salvors which could be shared by cargo owners.

Therefore it is important for cargo owners to advise their cargo insurers as soon as possible about their property on board this vessel. As the shipping company and government agencies have control of the salvage operation, we are reliant on the information they provide so clients also need to be guided by their statements.

As this ongoing process will be document driven, we will require the following documentation as soon as possible:

• Bills of Lading
• Commercial invoices
• Any insurance certificate issued
• Freight and shipping invoice
• Any correspondence received by the exporter from the shipping company or
  freight forwarder.

At this time of the year it is possible that some of this cargo was destined for Christmas demand in foreign markets. The delay in the discharge and reshipment of the goods may now mean that those goods miss their intended markets. Subject to any specific terms in the policy, such loss of market is generally not insured.

Depending on your client’s policy coverage and whether they are obliged to maintain supply to overseas customers, there may be some assistance in the form of reimbursement of additional costs incurred should their cargo be lost or damaged in this casualty.

Pleasurecraft
In addition there may be implications for Pleasurecraft owners with the risk of damage from hitting containers or damage to the hull from oil. We would urge owners to do their best to avoid potential problems by abiding by the “exclusion zones” and taking steps to keep away from any other known problem areas.

If you have any queries relating to your client’s cargo on the “Rena”, please contact the Lumley Marine team on (09) 308 1100 (for brokers north of Taupo) or 0800 922 929 or (04) 473 3640 (for brokers south of Taupo).