A veteran chemical tanker that damaged a power cable off Malta during a storm — costing €25m ($26.2m) to repair — could be without critical protection and indemnity cover.
TradeWinds understands that an exclusion clause covering claims related to propulsion machinery and engine breakdown was in place when the 35,500-dwt Chem P (built 1968) dragged its anchor in March, rupturing an interconnector power cable running between Malta and Sicily.
P&I cover would usually cover a shipowner’s third-party liabilities such as damage to property, as well as salvage. The owner of the Chem P is being sued for the repair work.
Power company Enemalta, owner of the cable, said after completing repairs: “These repair works alone cost around €25m. Enemalta has opened a legal case for damages against the owners of Chem P, the vessel that caused these damages.”
The first hint of problems over cover came when the Times of Malta reported that the ship’s P&I insurer, the West of England P&I Club, would not put up security for Enemalta’s claim in initial court proceedings.
The 54-year-old stream turbine tanker was purchased by RV International DMCC in December 2021 and fixed for a final voyage from the US east coast to India for recycling via the Suez Canal.
At the time, the Chem P had cleared its US Coast Guard and marine warranty survey (MWS) inspections.
Hull and machinery insurance was placed in the London market and P&I cover with the West of England.
The ship ran into trouble in the Atlantic after a blackout and was towed to Algeciras in Spain for repairs.
TradeWinds is told by sources familiar with the incident that an approved surveyor could not be found to carry out the MWS requested by its insurers, leading to the exclusion clause.
Another blackout
The vessel was to suffer another blackout and was towed to Malta and underwent repairs on 4 March 2022. P&I cover was again extended with the exclusion clause.
On 18 and 19 March, the Maltese islands were hit by severe weather, 50 to 55-knot winds and up to six-metre seas.
On 19 March, the Chem P’s anchor started to drag and the ship’s engines could not counter the storm. Although tugs were eventually sent, the anchor made contact with subsea power cables.
By 21 March, the vessel was towed to a safe anchorage.
Owners of the cable initially issued a €32m claim for damage against the ship.
The claim was reduced to €17.2m on appeal to the court, based on its right to limit liability.
The validity of P&I cover may hang on whether the ship’s engines were in working order and were deployed in attempting to avoid the storm.
The vessel is now the subject of a wreck removal order from Malta, another cost usually met through P&I cover.
If the casualty becomes a P&I claim, it is likely to become a pool claim under the International Group of P&I Clubs, whose 13 members share claims of more than $10m.
West of England has been approached for comment.
