US DoJ reaches $10m settlement with Furie Operating Alaska

The Department of Justice announced on April 5th that it had reached a $10m Jones Act settlement with Furie Operating Alaska over its use of a Chinese heavy lift ship to transport a jack-up(Spartan 151) from the Gulf of Mexico to Cook Inlet.

The DoJ asserted that the jack-up should have been transported by a US-flagged and US-crewed vessel. Customs and Border Protection had imposed a $15m fine in 2011. but Furie sued to overturn the fine in 2012. Negotiations have been progressing since then.

Escopeta Oil had wanted to bring Spartan 151 from the Gulf of Mexico to upper Cook Inlet for exploration work at the new Kitchen Lights gas field. Escopeta chartered Chinese semi-submersible heavy-lift vessel Kang Sheng Kou (IMO

9223289) to carry it around South America and thence up to Vancouver US-flagged tugs then took the rig in tow and took it the remaining distance to Alaska. Although Escopeta’s managers had obtained a Jones Act waiver for the voyage during the 2001-2008 US administration, this had expired. The Department of Homeland Security under the Obama administration turned down Escopeta’s request to renew it.

According to database, Kang Sheng Kou is currently entered for P&I Cover Owners with Gard for COSCO Shipping Specialized Carriers Inc. However, as we know, COSCO has moved some of its P&I cover around in recent years.