India Detains MSC Ship as it Seeks $1B in Compensation for MSC Elsa 3

 

The Kerala State Government in India followed through on its earlier assertions and filed a compensation claim in the courts against MSC for damages as a result of the loss of the MSC Elsa 3 off the coast in late May. As part of the claim, the High Court ordered the MSC Akiteta II, which was in port in India, detained until the company can post a bond in the case.

The admiralty court case seeks damages, citing the impact on the economy, environment, and the livelihood of fishermen following the sinking of the ship. In addition to the direct costs, the state claims a loss of confidence, which will have a long-term impact on business. 

The total claim is for $1.1 billion, with the bulk, $1 billion, for damages as a result of pollution. It is also seeking $44 million to restore the environment and a further $61.3 million in economic loss for the fishing community.

While there has been a minimal release of oil that was stopped by divers who capped the tanks, media reports cite a range of impacts. A total of 61 containers have been retrieved from the 643 that were aboard the ship when it went down. The Directorate General of Shipping reported that as of the beginning of July, an estimated 450 to 500 tonnes of nurdles have been collected from the shoreline. Volunteers continue to comb the beaches.

The media also reports that six large carcasses have been retrieved, including a dolphin and a whale. They are suspected of having died due to exposure to the microplastics or other toxic substances from the vessel.

MSC Akiteta II (30,592 dwt) happened to be the vessel in the Vizhinjam port when the case was filed. Built in 2001 and with a capacity of 2,226 TEU, it is slightly larger than the MSC Elsa 3 (1,730 TEU). The court ruled it was acceptable collateral and that it would be held pending MSC posting a bond. The court has permitted the vessel to continue to load and unload containers, but it is not permitted to depart. A hearing was scheduled for July 10.

The court followed a similar pattern with some of the individual claims that have already been filed. Other MSC vessels were detained until bonds were posted.

The case was filed while the investigation into possible safety lapses is ongoing. Previously, the Indian authorities contended the containers were improperly handled and secured. The media writes that an interim report has been sent to the Directorate General of Shipping, but it is still pending information from the VDR. The equipment was retrieved last month by divers and was taken ashore to be analyzed. The captain and crew of the ship remain in Kochi facing charges from the local police related to negligence in handling of the vessel and the dangerous cargo aboard.

Clean-up efforts for the vessel are also stalled pending a change in salvage companies. After the first phase was completed, which included capping the oil leaks, MSC elected to change salvage companies for the next phase. SMIT has filed a new plan with the government and reports that its equipment and divers will be arriving in India later this month. Weather permitting, they hope to begin diving on the wreck in August, and the plan calls for siphoning the fuel from the vessel’s tanks.