Legal claims against a tanker that escaped arrest off Sri Lanka could make a purchase for ship recycling costly.
Cash buyers and ship breaking firms risk consequences out of proportion to their winnings if they take on the arrested and escaped the 107,200-dwt Kutch Bay (built 1997) despite a court arrest order, according to Indian lawyer Shashank Agrawal of law firm SSA Legal.
A renewed ship recycling sale may already be in the works for the vessel, with Pakistan as the likely destination, after an earlier reported sale to cash buyers apparently fell through.
Agrawal's client, cargo financier UBS Switzerland, arrested the laden ship last week through lawyers in Sri Lanka on what was to be a final laden voyage before scrapping. But as TradeWinds reported on Monday, the ship evaded court officials and remains outside the country's territorial waters, with AIS switched off.
The ship is nevertheless "deemed to be arrested", the Gujarat-based lawyer asserts.
Kutch Bay's controversial fuel oil cargo was financed for troubled trader and bunkering player GP Global, the former Gulf Petrochem. The vessel, which was chartered by GP, is owned by an otherwise unknown Indian-based company called Alphabet Marine and managed by Silver Star Ship Management.
In a scrapping sale reported in August, the elderly tanker was reported to have brought just under $6m, while the legal claim by cargo financier UBS Switzerland comes to well over $26m.
"It is our understanding that the vessel may have been allegedly sold to a specific cash buyer and is heading to be scrapped at either Alang, Pakistan or Bangladesh," Agrawal wrote in a message to scrapping players that TradeWinds has seen.
No clear title
"Please be guided that the vessel carries an arrest order over her and her owners cannot issue a lien-free or encumbrance free-title to any subsequent purchaser.
"Our clients fully reserve their rights and will vigorously challenge any attempts to sell the vessel to any third party without the first prior and complete discharge of our client's claim."
That claim comes to some $26.6m plus interest and costs.
As previously reported, the Dubai office of the global Holman Fenwick Willan (HFW) law firm and Colombo-based DL&F De Saram are also on the case for UBS, a Swiss bank.
Meanwhile, another ship chartered from third parties by GP Global has also come under threat of arrest.
TradeWinds reported on Tuesday that another bank, Natixis, is targeting the 50,400-dwt product tanker Tenacity (built 2014), controlled by Greece's Sea Pioneer Shipping.
Natixis, as the bank that financed the cargo onboard and holds the bill of lading, claimed the cargo was misdelivered to parties not entitled to it.
GP Global, now in restructuring, has been unwilling to comment on specifics of the legal cases against it. Through an external public relations representative, the company has said that its chief restructuring officer and team "are in regular and professional communications with all our valued stakeholders to deliver a transparent, fair and satisfactory restructuring".
TradeWinds has tried without success to contact Kutch Bay owner Alphabet Marine for comment.
