FUELEU Maritime Requirements, compliance strategies, and commercial impacts

 The forthcoming regulations from the EU and likely the IMO are set to significantly affect the shipping industry, imposing substantial costs on vessel owners. This white paper gives an overview of the key requirements set out in the FuelEU Maritime Regulation (Regulation (EU) 2023/1805), hereafter referred to as ‘FuelEU Maritime’. 

We also use case studies to illustrate financial implications of the regulation, including identification of compliance strategies to reduce total costs. Moreover, we provide an overview of the roles and responsibilities of key actors in relation to FuelEU Maritime, focusing on commercial impacts. Finally, we give the latest status of IMO regulatory development on greenhouse gases (GHGs).

Full report may be downloaded at,

https://maritimecyprus.com/2024/12/11/%F0%9D%90%85%F0%9D%90%AE%F0%9D%90%9E%F0%9D%90%A5%F0%9D%90%84%F0%9D%90%94-%F0%9D%90%8C%F0%9D%90%9A%F0%9D%90%AB%F0%9D%90%A2%F0%9D%90%AD%F0%9D%90%A2%F0%9D%90%A6%F0%9D%90%9E-%F0%9D%90%91%F0%9D%90%9E/?utm_source=newsletter&utm_medium=email&utm_campaign=new_daily_mc_html_campaign

Is tank cleaning a cause of unnecessary enclosed space risks??

Ship managers’ association InterManager reported there had been 8 enclosed space deaths in seven days in December 2023, three seafarers and five shore workers. (It did not say what type of ships they were). He also said there were 31 known enclosed space deaths on ships in the 2023 calendar year, and 310 known enclosed space deaths on ships since 1996.

“We have crew members and shore workers placed under unrealistic time pressures to conduct high-risk tasks such as tank cleaning, and we have confusing instructions which vary from ship to ship as to what procedures and protocols must be followed,” said Captain Kuba Szymanski, secretary general of InterManager.
“This is an industry-wide issue which everyone in the shipping community must work together to resolve.”
“It’s not enough to blame the seafarers and offer additional training. Accident investigations must delve deeper into why people make the decisions they do and examine what external pressures impact those decisions.

“Ship architects and builders must work harder to design out these hazardous spaces where possible.”

Guy Johnson, owner of chemical tanker cleaning consultancy L&I Maritime, believes that tank cleaning could be done much more efficiently and safely.
“The mechanics of tank cleaning has not really changed in a long time,” he said. “We are all cleaning to standards that are set by commercial interests who have no real interest or understanding in how the cleaning is done, or whether or not it impacts the environment and crew safety.” “I am still trying to get the industry to eliminate the wall wash inspection, but my arguments, however sound, fall on deaf ears, because cargo quality is far more important than CO2 emissions and multiple confined space entry.”
“I recently set a poll on LinkedIn asking whether or not the chemical tanker industry should push IMO to ban wall wash inspections on safety and environmental grounds. Whilst I received a lot of positive comments, and thousands of reads, only 81 people voted.

è Combination carriers

Torvald Klaveness of Oslo operates 16 ‘combination carrier’ vessels. These can take both dry and wet cargo, with comprehensive cleaning in between.
A typical operation could be carrying sugar from a bioethanol plant in Brazil to India, then taking diesel from India to Brazil on the return leg. Other Brazilian products consumed in India are grain, soyabeans and caustic soda.
The tank cleaning can take 2-3 days, involving robots and infrared measurements. A combination carrier has much reduced carbon emissions in comparison to having two  vessels which carry cargo to a destination and sail back empty. The carbon benefits are also in shipbuilding, because one vessel replaces two. Combination carriers also reduce the
number of crew required, because an empty vessel still needs crew.
The average vessel spends only 30 per cent of its time laden, says Ernst Meyer, CEO of Klaveness.
The company has two types of combination carriers. Its “CLEANBU” vessels are both LR1 tankers and Kamsarmax dry bulk vessels, able to carry all dry bulk products, caustic soda and petroleum products. Its “CABU” vessels service the aluminium industry, carrying caustic soda solution and alumina, as well as other dry bulk commodities.
Combination carriers are not a new idea, but when they were introduced in the past, customers did not care so much about the savings in emissions and crewing costs. “It is a completely different world today,” he said. Mr Meyer estimates combination carriers could be viable for 10 to 15 per cent of today’s bulk shipping needs.

Ammonia as a Marine Fuel: Expert insights into the future of alternative fuels

 What is it? NH₃

Ammonia is a commonly produced industrial chemical. At ambient temperature and pressure, ammonia is a clear, colourless gas that is lighter than air. It can be absorbed in water and is corrosive, with potential for serious injury to eyes, throat and lungs. It has a distinctive pungent odour.

About 70% of current ammonia production is for the fertiliser industry (World Economic Forum, 2022) and it is seen as a critical resource for global food security. More than half of currently available ammonia is produced in four countries (China, the US, India and Russia), using hydrogen formed from natural gas and coal, then combined with nitrogen separated from the air using electricity. The hydrogen production processes, coal  gasification (26%) and steam methane reforming (73%), account for the majority of the CO₂ emitted during ammonia production today.

Production of ammonia currently emits 450 Mt of CO₂ per year, representing 1.3% of man-made emissions, the largest source of emissions in the chemical sector. While its demand from existing uses of ammonia continues to grow, new applications of ammonia as an efficient hydrogen carrier and a carbon-free fuel are set to make the most impact on demand. Global demand is expected to increase from 183 Mt in 2020 to 688 Mt in 2050. Of this new demand, less than half will be from existing uses, with 197 Mt expected from the maritime sector alone. A further 127 Mt will come the use of ammonia as a hydrogen carrier, supplying decarbonised feedstock and fuel for the chemical and industrial sectors (IRENA, 2022).

Decarbonisation efforts in sectors that already use ammonia products are adding pressure for production to become greener. There are two methods for producing the hydrogen used in the creation of clean ammonia. The first involves the use of fossil feedstocks and applying carbon capture and utilisation techniques. The second method involves using electrolysis to extract hydrogen from water, which is a cleaner alternative to reforming or gasifying hydrogen from coal or natural gas. Hydrogen from either source is combined with nitrogen extracted from the air, using the Haber-Bosch process. To produce green ammonia, renewable electricity is required for both electrolysis and for combining hydrogen with nitrogen.

Applicability

Where combustion fuel is concerned, ammonia is rising to prominence as a long-term  choice. Challenges are still being worked through but supposed ‘deal-breakers’ are quickly being surmounted, with the first ammonia-powered ships due to hit the water in 2025.

In terms of technology, engine-makers such as Wärtsilä, MAN Energy Solutions and WinGD have all reported significant progress in ammoniacapable marine engines in the past year. Bolstered by successful testing programmes and the concurrent development of fuel supply and safety mitigation systems, newbuild engines and retrofits (enabling existing engines to run on ammonia fuel) look set for commercial availability from 2025. Some pilot projects are already in operation.

Readiness of ammonia as a marine fuel

Lloyd’s Register has collaborated with industry stakeholders to build a comprehensive assessment of different aspects of the fuel supply chain from production to delivery onboard, and the technologies for use as a fuel onboard for power generation.

General safety and toxicity issues

Ammonia can be found naturally in the air, soil, water and in our bodies. It is also an ingredient in household cleaners and other household products. However, it can cause irritation and burning of the skin, mouth, throat, lungs and eyes. High levels can severely damage the lungs and lead to death. The level of harm depends on concentration and duration of exposure. Ambient ammonia vapour is lighter than air, however when compressed ammonia is released, the liquid flash evaporates, causing a heavier-than-air vapour cloud.

Recommendations

§  Lowering storage temperature to reduce the safety risk from ammonia fuel

§  Dividing the fuel preparation room into two or more separate spaces containing different groups of equipment that could leak ammonia

§  Minimising, monitoring, and controlling access to, and length of time spent, in spaces containing ammonia equipment

§  Placing ventilation outlets from spaces containing ammonia equipment in a safe location, adequately separated from areas accessed by crew, to avoid accidental release of toxic concentrations of ammonia affecting personnel

§  Installation of multiple sensors of different types to detect ammonia leaks

Ship operator demand and interest

Interest in ammonia as a fuel for shipping is driven both by its potential as a zero- or near-zero emissions fuel and by its anticipated increasing role in the world economy as an efficient, transportable energy carrier. As the world looks towards the hydrogen economy to decarbonise industry, the properties of ammonia make it more suitable to trading across oceans. And as more ships begin to carry ammonia, more will become candidates for using it as fuel. Ammonia’s growth in maritime can therefore be separated into two streams: increasing demand for ocean transportation from gas carriers, some of which will use the cargo as a fuel; and increasing demand specifically as a bunker fuel for non-gas carrying vessels.

Summary

In 2023, engine-makers began revealing their final designs. Shipbuilders will soon be able to complete and install these engines in frontrunner orders. Simultaneously, there is ongoing development in ammonia fuel supplies, with shipping companies securing offtake deals to ensure they have access to a steady supply of net-zero ammonia.

As with other low carbon intensity fuels, pricing of renewable electricity, green hydrogen  and carbon capture will all play into ammonia fuel pricing calculations. Clean ammonia producers, whether those creating new plants or incumbent manufacturers seeking to upgrade production to create blue and green ammonia, see potential in increased demand from agriculture and other sectors, as well as from shipping. This will put pressure on supply.

Another key element in ammonia deployment will be the lifecycle assessment of the fuel source to ensure vessels are fully capable of remaining compliant in an uncertain regulatory landscape. Future carbon pricing remains a key determinant in the use of any low-carbon fuel, including ammonia. Production costs remain high and the fuels have lower energy density compared to conventional fuel oils.

LR has proven it has the credentials to support companies pioneering ammonia as a fuel in the field. These include detailed HAZID, HAZOP and quantitative risk assessments, as well as several approvals in principle for vessel designs and technologies and significant technical rule development. As a fuel-agnostic and safety-oriented organisation, LR’s aim
is to assist in the development of a safe framework for the adoption of the ammonia cargo market and for ammonia’s use of other fuels.

There are significant safety challenges to the wider maritime use, and carriage of,  ammonia. By taking steps to develop this framework today, LR aims to rigorously address these challenges and avoid delay to the use of a potentially valuable fuel option for decarbonising industry and shipping.

Challenges notwithstanding, demand for oceanic transport of green ammonia as an energy carrier continues to grow. Projections indicate that a significant proportion of the world’s merchant fleet will, in the long term, benefit from the use of ammonia as fuel – delivering the first carbon-free power source for global shipping since the (first) age of sail ships.

For more details, download below the comprehensive report by LR "Fuel for Thought:
AMMONIA": https://maritimecyprus.com/wp-content/uploads/2024/03/LR_Fuel_for_Thought_Ammonia_c.pdf

 

Does a typhoon constitute force majeure and exempt the carrier from liability for cargo damage?

Recently, the Qingdao Maritime Court released the top ten cases of 2022 on its public platform. One of the cases dealt with the legal issue of whether a multimodal carrier can claim exemption from liability for cargo damage on the ground that a typhoon constitutes force majeure.

Facts

The plaintiff entrusted a logistics company (the defendant) to transport 12 containers of denim from Zouping, Shandong to Zengcheng, Guangdong. The scope of services was door-to-door which involved carriage by sea and in-land road transportation. The contract contained an exemption provision which stipulated that "the commissioned party is not responsible for losses due to natural disasters (heavy rain, typhoons, etc.)".

The goods were first transported by the first carrier to Jingtang Port and then by the second carrier to Nansha Port, where the goods were discharged and deposited at the port on 11 September 2018. On the same day, the meteorological department issued a typhoon warning, which was followed by successive typhoon warnings. On 16 September 2018, super typhoon "Shanzhu" made landfall along the coast of Guangdong. On 18 September 2018, the goods were shipped out of Nansha Port by the third carrier and delivered to the consignee on 25 September 2018.

At the process of unpacking and handover, it was found that eight containers with a total of 474 pieces of denim had suffered water damage. It was determined that the damage was caused by water ingress into the bottom of the container due to improper stacking and failure to take any precautionary measures during storage at the Nansha port.

Decision

The Court held that as the case concerned disputes over a multimodal transport contract which involved the carriage of goods by sea between Chinese ports, Contract Law was applicable⁽¹⁾ rather than Chapter IV of the Maritime Code which does not apply to the carriage of goods by sea between Chinese ports. As the cargo damage occurred during storage at the Nansha port and the defendant's position is as a multimodal transport operator, its period of responsibility lasted from the time it took delivery of the goods to the time it delivered the goods. Therefore, it was be held liable and obligated to compensate the plaintiff for the losses.

In this case, Typhoon Shanzhu did not meet the elements of force majeure which are "unforeseeable, unavoidable, and insurmountable" under Chinese law.⁽²⁾

First, the goods in question were transported to Nansha port on 11 September 2018, the day when the level IV emergency response to meteorological disasters (typhoons) was activated. Since then, the meteorological departments at all levels have continuously upgraded their emergency response to Typhoon Shanzhu and made rolling forecasts, all of which predicted that it would seriously affect Guangdong on 16 September.

Thus, that the typhoon would probably cause damage to the goods was foreseeable. In addition, the fact that defendant had informed the plaintiff about the eight containers stacked at the bottom might be wet damaged and in need of inspection before the container were delivered to the consignee also proved that the defendant actually did foresee the possibility of cargo damage.

Second, the multimodal transport contract between the plaintiff and the defendant contained neither transit to Nansha Port nor transshipment by the third carrier. The goods in question were transported to Nansha port on 11 September 2018 and were remained at the port until 18 September 2018. There was a five-day gap between the arrival of the good at Nansha port and the time when Typhoon Shanzhu had a serious impact on Guangdong. In fact, Nansha Port was less than 100 kilometers away from the final destination and place of receipt. The defendant had sufficient time to transport the goods to the final destination and place of receipt by in-land road transportation or other means and could have also notified the port to take necessary measures to re-stack the constrainers to avoid potential flooding. Therefore, the loss of goods was entirely avoidable and surmountable.

Third, although the contract between the plaintiff and the defendant contained an exemption provision which stipulated that "the commissioned party is not responsible for losses due to natural disasters (heavy rain, typhoons, etc.)" the Court viewed this provision not to be a statutory defence. The application of this exemption clause is subject to the premise that the damage to the goods was caused exclusively by natural disaster and that the carrier did not have any willful intent or gross negligence regarding the damage to the goods. If the carrier had had any willful intent or gross negligence with respect to the occurrence of the damage to the goods, it could not invoke this exemption clause.

Thus, as far as this case is concerned, Typhoon Shanzhu did not meet the constitutive elements of force majeure under Chinese laws and the defendant could not be exempted from liability.

The defendant later appealed against the judgment of the first instance on the ground that Typhoon Shanzhu constituted force majeure. The High Court of Shandong Province rejected the appeal and upheld the original judgment. The defendant's application to the Supreme Court for a retrial was also rejected.

Comment

In the carriage of goods by sea, it is not uncommon for carriers to claim exemption from liability for cargo damage on the grounds that typhoons constitute force majeure. However, where, as in this case, there are alternative means to transport the goods or protect the good from wet damage, the carrier cannot claim exemption from lability on the ground of force majeure if it had not taken the most efficient means.

This case reaffirms and clarifies that natural disasters such as typhoons are not ipso facto force majeure, but they should be determined in a comprehensive manner in terms of both the objective characteristics of the event and the subjective behavior of the carrier. For typhoon to be recognised as force majeure it must be unforeseeable, unavoidable and insurmountable. However, if the carrier omitted to take actions or was grossly negligent in performing its duties regarding proper cargo care, it cannot invoke force majeure to exempt itself from liability.

The similar rule also applies when the carrier invokes the statutory defence of exemption under article 51 of Charter IV of the Maritime Code. The law stipulates that "the carrier shall not be liable for the loss of or damage to the goods occurred during the period of carrier's responsibility arising or resulting from act of god and sea perils". In legal practice, typhoons are generally not recognised as an act of God or sea perils, as the wind, the duration and extent of a typhoon are usually predictable. However, if a typhoon brings abnormal and unforeseeable risks, and the carrier has fulfilled its duty of care, the carrier may be exempted from liability for damage to the goods.

 

Wind forces, mooring strategies, and common high-wind challenges.

As the American Club warns, the unpredictable force of the wind, often underestimated, significantly impacts large sail area (profile) vessels, especially when moored. 

Their large sail areas expose them to potential beam wind hazards, leading to risks like a vessel breakaway that can result in a grounding, allision, collision, or damage to third party property.

Factors affecting mooring 

If the vessel captain decides to stay moored after considering the expected wind speed, estimated wind load, and other general considerations, the vessel should deploy extra mooring lines taking into account the following factors:

§  Conditions and age of the mooring ropes;

§  Brake render settings of the mooring winches;

§  Availability and safe working load of shore/terminal mooring points;

§  Conditions of shore/terminal mooring points;

§  Maximum number of moorings allowed to each mooring point;

§  Mooring pattern/arrangement and lead of the mooring lines;

§  Terminal recommendations for mooring arrangements;

§  Availability of tug assistance and linesmen that may be required to assist on short notice;

§  Potential wake effects of passing vessels on moored vessels;

§  Any forthcoming high tides or currents at the location that can put additional strain on the mooring lines;

§  Availability of clear and constant communication between the ship’s crew, the terminal staff, and tug operators; and

§  Familiarity with port and terminal procedures, rules and guidelines that are relevant to mooring in high wind conditions, as may be applicable.

Complications

There are several mooring operations related complications that may arise during periods of high winds that should be considered:

§  overloading bollards due to the load from one or multiple mooring lines

§  using older and weaker mooring lines

§  incorrect settings on constant tension winches or winch render settings

§  lack of situational awareness and monitoring of weather conditions

§  inability to deploy additional mooring lines due to unavailability of line handlers

Lessons learned

§  Plan for the expected weather, especially if wind gust velocities are anticipated to be high.

§  Plan the mooring arrangement in advance of arrival as ashore mooring points can vary

§  Know the capacities of the available mooring points ashore.

§  Increasing the number of mooring lines before the weather deteriorates is much easier.

§  Anticipate that thunderstorms can often include high winds.

§  Training and drilling for high wind events can include line handling drills, emergency departure and engine start drills, and ensuring crew readiness in an actual situation.

§  Establish and prepare an emergency action plan to mitigate the consequences of a mooring failure or vessel breakaway. For large sail (profile) vessels, such considerations should be part of the safety management system’s emergency preparedness procedures.

§  Perform a risk assessment before the vessel is berthed to help identify any possible issues and to enable planning for mitigation actions.

§  Identify and liaise with local port authorities and meteorological departments.

§  Cooperation with these authorities can be beneficial for gaining an understanding of local weather patterns and berth characteristics.

See full alert here

https://safety4sea.com/wp-content/uploads/2023/07/AmericanClub-Mooring-Precautions-for-Vessels-with-Large-Sail-Areas-When-Expecting-High-Winds-2023_05.pdf

Shipowner may disregard charterers' voyage instructions without interrupting demurrage

 Introduction

The High Court has clarified when a shipowner may disregard charterers' voyage instructions without interrupting demurrage, in a decision that underlines the obligation of voyage charterers to choose safe ports and berths for vessels.

The recent High Court decision in CM P-Max III Ltd v Petroleos Del Norte SA (the "Stena Primorsk") is a helpful reminder as to when owners may disregard charterers' voyage orders without preventing demurrage from running.

Facts

The owners (also the claimants) chartered out the vessel "Stena Primorsk" on a voyage charter based on the Shellvoy 6 form. Pursuant to the terms of the charterparty (CP), the charterers had a total allowance of 72 hours of laytime for both loading and discharge.

The cargo was loaded onto the vessel in the port of Bilbao. It was undisputed that this loading process took 68 hours and 54 minutes of laytime. The vessel subsequently proceeded towards Paulsboro, the nominated discharge port situated on the Delaware river.

Since the vessel's freshwater draft only exceeded the depth of the discharge berth by four centimetres and the tide was expected to vary by 1.6 metres, the master applied for a waiver under the vessel's keel clearance insurance policy prior to berthing. The waiver was granted on a one-off basis and on the assumption the vessel's draft would be equal to or less than the river's declared safe draft at high tide and that discharge would commence promptly after arrival.

Once the vessel arrived at the discharge berth on 31 March 2019, the master was informed that discharge could only take place at a reduced rate initially (for seven to eight hours). Taking into account the fluctuations in the tide and the rate of discharge, the master concluded that the vessel would not be able to maintain a sufficient keel clearance and there was a risk that the vessel could touch bottom. The vessel then departed the berth, returning to anchorage 12 minutes after arrival.

On 1 April 2019, another discharge berth which could facilitate a higher rate of discharge became available. The charterers therefore gave the owners orders to proceed to this berth to complete the discharge of the cargo.

Before proceeding to the newly available berth, the owners applied for another waiver under the insurance policy. The request had no allowances for delays, berthing, connections or technical failures. The request was declined on the basis that the risk that the vessel could touch bottom was too great. Proceeding to the berth would have constituted a breach of the insurance policy. As a result, the master did not comply with the charterers' orders.

Eventually, part of the cargo was lightered on 4 April 2019, and the balance was discharged at the discharge berth on 6 April 2019. The whole discharge process took an additional 154.63 hours, with the aggregate laytime used for loading and discharge amounting to 226.63 hours. The owners claimed for demurrage amounting to $143,153.64 at the applicable demurrage rate under the CP.

It is also worth highlighting that the CP contained the following clauses which were relevant to the dispute.

Clause 3(1):

Subject to the provisions of this Charter the vessel shall perform her service with utmost despatch and shall [having loaded the vessel] proceed as ordered on signing bills of lading to such berths as Charterers may specify, in any port or ports within Part I clause (E) nominated by Charterers, or so near thereunto as she may safely get and there, always safely afloat, discharge the cargo.

Clause 3(2):

Owners shall be responsible for and indemnify Charterers for any time, costs, delays or loss including but not limited to use of laytime, demurrage, . . . due to any failure whatsoever to comply fully with Charterers' voyage instructions . . . Owners shall adhere to Charterers' voyage instructions as long as such orders are considered safe by the Master of the ship.

Clause 4 – "Charterers shall exercise due diligence to order the vessel only to ports and berths which are safe for the vessel and where the vessel will always be afloat".

Clause 7:

If requested by Charterer, Vessel shall load and/or discharge more than one grade simultaneously if Vessel is technically capable of doing so. Any delay resulting from the failure by Owners to provide such personnel, equipment and facilities shall not count as laytime or, if the vessel is on demurrage, as demurrage.

Clause 13(1)(a) provided that time at the port of discharge would commence to run six hours after the notice of readiness had been tendered by the master or owners' agents to charterers or their agents and/or the vessel was securely moored at the specified loading or discharging berth, whichever occured first. If the owners:

fail to obtain free pratique unless this is not customary prior to berthing . . . either within the 6 hours after notice of readiness originally tendered or when time would otherwise normally commence under this Charter, then the original notice of readiness shall not be valid.

Clause 14: "Time shall not count when: . . . (c) lost as a result of: (i) breach of this Charter by Owners".

Clause 15(2):

Any delays for which laytime/demurrage consequences are not specifically allocated in this or any other clause of this Charter and which are beyond the reasonable control of Owner or Charterer shall count as laytime or, if Vessel is on demurrage, as time on demurrage. If demurrage is incurred, on account of such delays, it shall be paid at half the Demurrage Rate.

The CP also contained a warranty confirming that the information set out in the Q88 questionnaire appended to the CP was "an integral part" of the CP. The questionnaire contained a detailed list of information on the vessel that the charterers would require to utilise the vessel safely (including the vessel's draft, its insurers and the owners' guidelines for keel clearance).

Dispute
The dispute centred around whether laytime continued to run after:

• the initial departure from the discharge berth on 31 March 2019; and
• the owners' refusal to comply with the charterers' orders the following day to proceed to the alternate discharge berth.

Given the factual matrix, the owners' claim was for demurrage and lighterage costs, rather than for damages for breach of the safe port warranty. The charterers in turn counterclaimed for lighterage costs.

Decision

Experts from both sides agreed that the original departure from the berth on 31 March 2019 was a reasonable decision made on safety grounds.

It followed that this action was reasonable and did not put the owners in breach of the CP. Therefore, time continued to run after the departure from the first berth.

With respect to the masters' decision not to proceed to the second discharge berth on 1 April 2019, during the discussion of the legal position, Judge Bird highlighted the following with respect to the terms of the CP:

• The obligation to proceed with "utmost dispatch" was qualified by the requirement for the vessel to remain safely afloat.
• The obligation of the owners to comply with the charterers' voyage instructions was also not an absolute one.
• The master had a right not to comply with voyage orders that he did not consider to be safe.
• The charterers were obliged to exercise "due diligence" in choosing ports and berths to ensure that they would be "safe for the vessel" to proceed to.
• It was "apt" to refer to the Q88 questionnaire as an integral part of the CP which could not be ignored.

The discussion also referred to Fontevivo decision, which established that for demurrage to stop, a charterer must establish that the owner be at "fault". In that case, demurrage stopped running where the owner's decision to move off the berth was not reasonably necessary.

Consequently, the owners were entitled to rely on the keel clearance policy as justification for refusing to comply with the charterers' orders to proceed to the second discharge berth. The owners' actions were deemed to comply with clause 3(1) of the CP.

As a result, laytime continued to run for the purposes of demurrage. It also followed that the charterers' counterclaim for lighterage costs failed.

Comment

This judgment is helpful authority that:

• the master can refuse to comply with voyage instructions where they give rise to reasonable safety concerns; and
• laytime will continue to run unless the charterers can establish that there has been a "fault" in non-compliance with their instructions.