Suez Canal blockage
With ship now freed, a probe into Suez Canal blockage begins
Experts boarded the massive container ship Tuesday that had blocked Egypt's vital Suez Canal and disrupted global trade for nearly a week, seeking answers to a single question that could have billions of dollars in legal repercussions: What went wrong?
As convoys of ships again began traveling through the artery linking the Mediterranean and Red Seas, a canal service provider said more than 300 vessels carrying everything from crude oil to cattle were still waiting for their turn in a process that will take days. Egyptian government officials, insurers, shippers and others similarly waited for more details about what caused the skyscraper-sized Ever Given to become wedged across the canal on March 23.
When blame gets assigned, it will likely lead to years of litigation to recoup the costs of repairing the ship, fixing the canal and reimbursing those who saw their cargo shipments disrupted. Since the vessel is owned by a Japanese firm, operated by a Taiwanese shipper, flagged in Panama and now stuck in Egypt, matters quickly become an international morass.
"This ship is a multinational conglomeration," said Capt. John Konrad, the founder and CEO of the shipping news website gcaptain.com.
Experts boarded the Ever Given as it idled Tuesday in Egypt's Great Bitter Lake, just north of the site where it previously blocked the canal. A senior canal pilot, speaking on condition of anonymity because he was not authorized to talk to journalists, told The Associated Press that experts were looking for signs of damage and trying to determine why the vessel ran aground.
There could be significant damage to the the ship, Konrad warned. Stuck for days across the canal, the ship's middle rose and fell with the tide, bending up and down under the tremendous weight of some 20,000 containers across its 400-meter (quarter-mile) length. On Monday, when workers partially floated the ship, all that pressure came forward to its bow.
"Structural integrity is No. 1. You know, there was a lot of strain on that ship as it was sagging in the waterway," Konrad said. "They have to check everything for cracks and particularly that rudder and the propeller in the back that's connected to the engine room."
"And then they have to go through all the mechanical equipment, make sure they test the engines, all the safety valves, all the equipment, and then determine that it's safe to sail either by itself or with a tug escort to the next port," he added.
The ship's owner, Shoei Kisen Kaisha Ltd., said Tuesday that it would be part of the investigation along with other parties, though it did not identify them by name. It also refused to discuss possible causes of the grounding, including the ship's speed and the high winds that buffeted it during a sandstorm, saying it could not comment on an ongoing investigation. Initial reports also suggested a "blackout" struck the vessel, something denied by the ship's technical manager.
The company added that any damage to the ship was believed to be mostly on its keel. It said it was not immediately known whether the vessel will be repaired on site in Egypt or elsewhere, or whether it will eventually head to its initial destination of Rotterdam. That is a decision to be made by its operator, rather than the shipowner, the company said.
The grounding of the ship had halted billions of dollars a day in maritime commerce. Analysts expect it could take at least another 10 days to clear the backlog — though Egypt's president said Tuesday it would take just three. The losses to shippers, as well as any physical damage to the vessel itself, likely will see lawsuits.
Shoei Kisen Kaisha Ltd. is covered with some $3 billion in liability insurance through 13 Protection & Indemnity Clubs. Those clubs are not-for-profit mutual insurers used by the vast majority of global shipping firms.
Global legal firm Clyde and Co. said the Ever Given's owner likely would pay Egypt's canal authority for the assistance already rendered to the vessel. The authority also could fine the Ever Given.
"We anticipate a detailed investigation will follow which will determine the cause," the firm said. "Evidently the cause will impact upon the legal liabilities of the ship and cargo interests."
Egyptian President Abdel Fattah el-Sissi traveled Tuesday to the canalside city of Ismailia to praise those who freed the vessel.
Speaking to a small group of reporters on a dock overlooking the waterway, el-Sissi deflected questions about the investigation, saying Egypt would not interfere in a probe that will be left to "the specialists."
"We want to confirm to all the world, that things are back to as they were," he added. He stood before a sign that said: "Welcome to the Suez Canal: Egypt's lifeline of peace, prosperity and development."
On Monday, a flotilla of tugboats helped by the tides, wrenched the bulbous bow of Ever Given from the canal's sandy bank, where it had been firmly lodged. The tugs blared their horns in jubilation as they guided the Ever Given through the water after days of futility that had captivated the world, drawing scrutiny and social media ridicule.
The Ever Given had crashed into a bank of a single-lane stretch of the canal about 6 kilometers (3.7 miles) north of the southern entrance, near the city of Suez. That forced some ships to take the long, alternate route around the Cape of Good Hope at Africa's southern tip — a 5,000-kilometer (3,100-mile) detour that costs ships hundreds of thousands of dollars in fuel and other costs.
The unprecedented shutdown, which raised fears of extended delays, goods shortages and rising costs for consumers, added to strain on the shipping industry already under pressure from the coronavirus pandemic.
3 years ago
What we know about a ship blocking the Suez Canal
A giant backhoe and a squadron of tugboats look minuscule against the cargo ship’s bulk, demonstrating the enormity of the challenge at hand: freeing the wedged, skyscraper-sized container ship that has blocked the entire width of the Suez Canal and created a major traffic jam on one of the world’s most crucial trade routes.
The tugs and diggers toiled on Thursday as over 150 vessels carrying goods to destinations across the world on tight schedules remained trapped on either end of the canal, which links the Mediterranean and Red Seas.
Over its 150-year history, Egypt’s Suez Canal has seen wars and crises — but nothing quite like the stranding of the Ever Given.
HOW DID THIS HAPPEN?
That remains murky. The vessel entered the canal from the Red Sea on Tuesday morning and ran aground 45 minutes later.
The ship’s operator and Egyptian officials blamed winds gusting as much as 50 kilometers per hour (30 miles per hour), along with a sandstorm sweeping the area.
Cargo ships have grown in recent years to take on more containers as fuel prices have risen because big boats burn less fuel per container moved. Some have wondered if the ultra-large size of the Ever Given was a factor.
While the supersize of ships can increase their risk of running aground in the Suez Canal, boats just as big buffeted by winds just as strong have passed through the waterway without incident before.
Instead, it’s likely that “a combination of factors” was at play, said Ian Woods, a marine cargo lawyer and partner with the firm Clyde & Co.
“There’s the exposure to the elements, potential for a loss of power, potential for steering problems,” Woods said. “We’d expect a full investigation.”
The obstruction could prove embarrassing for Egypt, where the waterway long has been a symbol of national pride. President Abdel Fattah el-Sissi poured $8.2 billion into a lavish expansion of the canal that was unveiled in 2015. However, the Ever Given got stuck just south of that new section.
HOW WILL THEY FIX THIS?
So far, dredgers and tugboats haven’t been able to free the ship. An expert salvage team, whose job it is to respond to boat-related disasters, flew from the Netherlands to the canal on Thursday to join the efforts.
Already, it seems the ship’s massive weight, some 220,000 tons, could make it impossible to dislodge and float. To lighten the load, the team says it may have to remove at least some of the ship’s containers and drain the vessel of the water serving as ballast before further dredging the area and then trying again to nudge the ship using tugboats.
Officials had indicated initially they didn’t want to do that because the unloading itself could take days or weeks.
WHY DOES IT MATTER?
Over 10% of global trade, including 7% of the world’s oil, passes through the canal. After the blockage, the price of international benchmark Brent crude shot up some 3% to $63 a barrel.
Goods passing through the canal are typically moving from east to west. In addition to oil, liquified natural gas from the Persian Gulf and furniture, clothes and supermarket basics from China use the canal to avoid taking a circuitous 5,000-kilometer (3,1000-mile) route around Africa.
Shipping journal Lloyd’s List estimates that the closed waterway is tying up billions of dollars of goods each day the canal is closed — at a time when the coronavirus pandemic is already causing demand in consumer goods to surge.
Not only will deliveries be delayed, but the jam also prevents the return of empty containers back to Asia, exacerbating a container shortage caused by the pandemic’s disruptions to shipping.
“It’s almost like a ketchup bottle,” said Lars Jensen, chief executive of SeaIntelligence Consulting. “The longer this lasts, the higher risk that we are going to see major congestion problems in the European ports.”
WHAT IS THE WORLD’S REACTION?
While the real-world consequences of the jam are serious, many also noted the absurdity of the situation in a seemingly endless flood of social media memes.
In one viral post, the gigantic ship was captioned “my tasks,” and the comparatively puny backhoe “me, dutifully chipping away at my tasks.” In another, the boat was “your first draft” and the backhoe “editors.”
3 years ago