Shipping Offshore Update Desember 2019
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The UK Supreme Court’s decision in the “Renos” on CTL and the position under the Nordic Plan
The UK Supreme Court’s recent decision in the “Renos” (Sveriges Angfartygs Assurans Forening (The Swedish Club) and others v Connect Shipping Inc and another, [2019] UKSC 29) will be a landmark case on marine insurance under the English Institute Time Clauses Hulls (1/10/83) ("ITCH") conditions. It clarifies that when determining whether a vessel is a constructive total loss (“CTL”) under the ITCH conditions, regard should be had to (a) the costs incurred prior to the owners’ notice of abandonment, but not (b) remuneration payable under the SCOPIC clause. The decision will have significant importance in the insurance market because of the financial and practical implications. But what would be the position under the Nordic Marine Insurance Plan of 2013 version 2019 (“Nordic Plan”)?
Shipbuilding from A to Z
Øystein Meland has worked with shipbuilding related matters on behalf of Wikborg Rein for more than 30 years, acting for both Norwegian and international clients. Capitalising on this experience, Meland launched the latest edition of his book “Shipbuilding Contracts – A commentary based on SHIP 2000” on 30 October 2019.
Contractual options for stranded assets
The downturn in the offshore markets has clearly been deeper and more longer lasting than had originally been expected following the collapse of the oil price back in 2014. This article takes a brief look at the current situation and at some of the contracting solutions that we are seeing in these markets.
Shipbuilding – the consequences of disruption by buyers
In the lead-up to delivery under shipbuilding and offshore fabrication contracts where delivery is delayed, buyers may, from time to time, face claims that they have disrupted the contractor’s progress in such a way that the contractor is entitled to an extension of the delivery date and/or damages for the additional costs incurred. A recent ruling from the Norwegian Supreme Court involving land-based construction clarifies the requirements as to causation for such a claim to succeed.
Teekay shuttle tankers issues the first Nordic maritime green bond
In early October 2019 Teekay Shuttle Tankers LLC (“Teekay”) successfully placed its USD 125 million inaugural green bond, the first green bond to be issued in the Nordic markets by the maritime industries.
Shipping project finance – new regulatory intricacies
Project financing has historically been a popular investment scheme and source of capital in Norway for shipping projects. The Norwegian regulatory authorities have however recently published guidelines regarding the application of the alternative investment fund regime on project finance entities and it is important that issuers, advisors, arrangers and investors are aware of the pitfalls of being captured by the wide definition of an alternative investment fund, and what steps they can take in order to adapt to the regulations.
How many attacks does it take to make the Strait of Hormuz unsafe?
Since May 2019, there have been six oil tankers attacked in the Strait of Hormuz, four on 12 May 2019 and two on 13 June 2019, all allegedly with limpet mines or drones/missiles. Despite these attacks, vessels are however still taking orders to sail through the Strait albeit at higher war risk insurance rates and no doubt heightened crew concerns. Whilst the occurrence of such attacks might lead to war risk clauses in the governing charterparties being invoked and the war risk insurers applying their own approach to the situation, at what point, under English law, can owners refuse such voyage orders on the basis that the Strait is contractually unsafe?
Public consultation on offshore wind power in Norway
In July 2019, the Norwegian Ministry of Petroleum and Energy (the “Ministry”) presented a proposal to open up certain areas offshore Norway for the development and construction of offshore wind farms. In this article we will provide an overview of certain characteristics of those areas as well as the proposed new regulations related to offshore renewable energy production.