Nickel ore – a liquefaction risk

Marine insurer Skuld has warned that liquefaction risks of nickel ore cargoes from Indonesia and the Philippines had been a long-standing prominent issue, “which require constant vigilance and review by shipowners and charterers”.

Janice Dao Yeung Yeung, Senior Claims Executive with Skuld and based in Hong Kong, has written that, since 2010, the liquefaction of nickel ore cargoes had caused seven vessels to capsize. The capsizing of MV Emerald Star in October 2017 again demonstrated the importance of strict compliance with the IMSBC Code (2016 edition) and the other relevant international conventions, Skuld said, while noting that, with the rainy season approaching, now was a good time to revisit the issue.

The Philippines and Indonesia are the major suppliers of nickel ore cargoes. For the Philippines, the popular loading areas are Surigao, Tubay and Davao where the traditional dry season is usually from November to April. However, global warming and fluctuations in weather patterns have long since extended the rainy season and shortened the traditional ‘dry season’.

Like the Philippines, the dry season for loading in Indonesia at ports such as Buli, Gebe and Pomalaa runs from November to April, but this too has been curtailed due to changing weather patterns.

One major difference between the nickel ore loading industries in these two countries is, however, that while IG Clubs have been able to establish close connections with their approved and qualified local correspondents/surveyors in the Philippines throughout the years, such connections remain less developed in Indonesia since the ban of nickel ore exports in 2014. This ban was only lifted in 2017. It will therefore take time to establish the same intelligence level as in the Philippines, said Skuld.

Skuld has prepared a guidance to Masters/local surveyors on what they should do when loading nickel ore. It is a mandatory requirement for Members loading Group A cargo to notify their P&I Club to avoid any prejudice to their insurance cover.—a-liquefaction-risk/