Ever Given impounded in Suez Canal as Egypt seeks over S$1.2 billion in compensation

Both sides are wrangling over the size of the claim.

Matthias Ang | April 15, 2021, 06:56 PM

The Ever Given may have finally been freed from the Suez Canal, after being stuck for six days.

However, it has yet to leave the waterway as the ship and its cargo have been seized by Egyptian authorities.

Theyare seeking compensation of over US$900 million (S$1.2 billion) for losses, maintenance fees and the cost of the rescue operation, both CNN and the Financial Times (FT) reported.

The order for its seizure was given by an Egyptian court as talks between the Suez Canal Authority (SCA) and the Ever Given's Japanese company owner, Shoei Kisen Kaisha (Kisen), along with its insurers, about who should pay for the losses, continue.

The ship has been moved to a section of the canal known as the Great Bitter Lake where it is being inspected and repaired, as well as to allow traffic to pass.

A crew of 25 Indian nationals also remain onboard the ship.

Suez Canal Authority: "They don't want to pay anything"

The head of the SCA, Osama Rabie, highlighted that the Kisen was attempting to reduce the bill by 90 per cent and that they "don't want to pay anything."

Rabie also noted that apart from the rescue, the compensation also covered delay costs and damages to the equipment and canal.

Rabie added that the canal "suffered enormous damages and we made no mistakes."

At the time of the incident the SCA had placed two pilots aboard the vessels to help them navigate the waterway.

Insurer: Claim is "largely unsupported"

Meanwhile, one of the Ever Given's insurers, UK P&I Club, said in a statement that the claim was "largely unsupported" and not valid.

The insurer elaborated that the SCA had not provided "a detailed justification for this extraordinarily large claim" which includes a US$300 million (S$400.3 million) claim for "loss of reputation" and another claim of the same amount for a "salvage bonus".

In addition, it does not include the professional salvor for the provided salvage services, which is expected to be received separately by the owners and their hull underwriters.

The insurer also pointed out that the grounding of the Ever Given in the waterway had not resulted in pollution or injuries.

They were echoed by the Ever Given's Taiwanese operator, the Evergreen Marine, which said that the SCA's claim lacked justification.

Quick resolution unlikely

In acknowledging that it was investigating the scope of the court order, Evergreen Marine said that it urged all parties concerned "to facilitate a settled agreement."

Kisen itself stated that insurance companies and lawyers are looking at the SCA's claim, without providing further comment.

A cargo owner with good aboard the ship said that he did not expect a quick resolution in due course and has since told his customers "to plan for a life without that cargo in the medium term."

CNN further reported that over 400 ships were affected by the Ever Given's blockage of the Suez Canal on Mar. 23 when it ran aground. How exactly it ran aground, however, is still being investigated by Egyptian authorities.

Top photo by Mahmoud Khaled/Getty Images