Meadway Shipping sues for unsuitable bunkers

Greece-based ship managing and chartering company Meadway Shipping and Trading is suing Denmark-based charterer Integrity Bulk ApS (IBA) for $2.15mn in damages, alleging that IBA fueled one of the vessels it was sub-chartering from Meadway with unsuitable marine fuel.

The lawsuit alleges that IBA, which sub-chartered the 37,070t deadweight bulk carrier Asl Luna from Meadway, and fueled it in Balboa, Panama in June with faulty bunkers, which caused all six injector pumps of the main engine fuel to seize. According to the filing, a laboratory test showed that the total phenol content of the bunker added up to 106 parts per million (ppm), whereas typically this content is less than 100ppm. The lawsuit alleges that presence of phenol indicates the possible use of shale oil as cutter stock. Phenols can damage lubrication surfaces and also reduce the stability of the fuel. Shale oil alledgedly impacts the ignition and combustion properties of the fuel. In addition, the fuel also contained styrene glycol, alpha-pinene and limonene and 2,4-dittertbutylphenol, not normally found in bunker fuels.

The damages that the lawsuit claims include $10,235.50/day in loss of hire paid to the owners of the vessel, while the vessel was waiting for analysis of the bunkers on 14-20 July. The vessel's trading opportunities were restrained due to the suspected bunkers remaining on board, which the lawsuit pegs as $100,000 loss. Meadway also may be required to remove the faulty fuel at an estimated cost of $300,000. The damage to the vessel, which has not been fully assessed, is estimated at $500,000.

The lawsuit was filed on 27 July in the US District Court for the District of Maryland, Baltimore Division. The lawsuit alleges that according to the sub-charter agreement IBA was responsible for fueling of the vessel and is liable for losses or damages caused by unsuitable fuels. IBA is also responsible for the offloading of the unsuitable fuels and the supply of fresh fuels. IBA did not reply when reached for comment. According to IBA's annual report the company generated $3.69mn in profit for the fiscal year, which ended on 31 March.