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Lawyer: Rights of retention over bunkers only ‘good in theory’

Bunker trading and supply companies ‘really out on a limb’ without credit risk insurance, says Senior Partner of law firm JTJB LLP at IBIA Asia Bunker Symposium.

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It is inadvisable to depend on using the Rights of Retention clause in contracts to claim back bunkers in the event of a dispute, says the Senior Partner of Singapore-based legal firm JTJB LLP.

“A clear point from the OW Bunker debacle is the bunker suppliers right of retention to title claims, which is generally found in all standard terms and conditions,” Danny Chua told delegates at the IBIA Asia Bunker Symposium.

“It is very clear in the OW bunker case that bunkers supplied are meant to be consumed and therefore retention of title clause is generally quite useless.

“This is because by the time you want to effect any recovery of your bunkers on board they will either have been co-mingled with other marine fuel or have already been consumed.

“So therefore that clause is only good in theory.”

A bunkering firm encounters the same amount of credit risk when dealing with shipowners, operators or charterers and cannot arrest a vessel when dealing with an intermediary.

The only answer for a bunkering firm wishing to insulate its credit risk is to seek insurance, recommends Chua.

“From the experience of the OW bunker demise, not many creditors here had taken out credit insurance and this was sad because a lot of the victims in the OW bunker collapse were physical suppliers,” he says.

“Nowadays, each stem runs into at least a million dollars. It is a fair bit of debt to recover and if you do not have credit risk insurance you are really out on a limb.”

The IBIA Asia Bunker Symposium is held as part of Asia Pacific Maritime 2018.

 
Photo credit: Nadiah Zulkifle, IBIA (Asia)
Published: 16 March, 2018
 

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Incident

India: MSC faces USD 1.1 billion lawsuit from Kerala state over “MSC ELSA 3” bunker spill

Reports noted approximately 84 mt of diesel and 376 mt of fuel oil on board the stricken vessel when it sank carrying 643 boxes.

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MSC Elsa 3 MT

Swiss-based Mediterranean Shipping Company (MSC) is reportedly facing a USD 1.1 billion lawsuit from India’s southern state of Kerala which is seeking compensation over marine fuel leaked from MSC ELSA 3 into the Arabian Sea in May.

The High Court of Kerala on Monday (7 July) ordered authorities to seize containership MSC Akiteta II which was anchored in Vizhinjam Port until securities for the claim amount are deposited.

The 1,700 TEU capacity containership MSC ELSA 3 was sailing from Vizhinjam to Kochi when failure in its ballast management system caused it to sink on 25 May about 13 nautical miles off the coast of Kerala.

Reports noted approximately 84 metric tonnes (mt) of diesel and 376 mt of fuel oil on board the stricken vessel when it sank carrying 643 boxes.

 

Photo credit: Indian Ministry of Defence
Published: 9 July 2025

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Legal

Shell MGO bunker heist: Co-conspirator receives 302-month jail sentence

Abdul Latif Bin Ibrahim and accomplices siphoned over 150,000 mt of gasoil worth at least USD 74 million from Shell Pukom between August 2014 and January 2018.

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A Judge at the High Court of the Republic of Singapore on Monday (7 July) sentenced Abdul Latif Bin Ibrahim, a former Process Technician working at Shell Pulau Bukom, to a jail term of 25 years and two months (302 months), reported the Straits Times.

Latif pleaded guilty to a total of 30 charges – 20 charges under criminal breach of trust and 10 charges under money laundering – while consenting to have 34 remaining charges taken into consideration for the purposes of sentencing.

The 67-year-old male is due to start his prison sentence on 30 September 2025.

Court documents obtained by Singapore bunkering publication Manifold Times showed Latif, with the help of other rogue Shell employees, siphoning over 150,000 metric tonnes (mt) of gasoil valued at least USD 74,469,000 (approximately SGD 100,601,000) from Shell Eastern Petroleum Pte Ltd’s (Shell) Pulau Bukom facility between August 2014 and January 2018.

Latif was arrested on 7 January 2018.

Investigations found him receiving a total of at least about SGD 7 million in criminal benefits between 2014 to 2018, of which he spent these monies on luxury watches, foreign property, cars, amongst others.

Authorities have seized assets worth approximately SGD 7.67 million from Latif; amongst recovered are:

  • One Rolex Daytona (leather strap) watch worth SGD 28,800
  • One Frank Muller watch worth SGD 7,000
  • One Frank Muller watch worth SGD 8,000
  • 03 packs of 1,000 pcs of SGD 1,000 notes worth SGD 3 million
  • 991 pcs of 1,000 pcs of SGD 1,000 notes worth SGD 991,000
  • 400 pcs of 1,000 pcs of SGD 1,000 notes worth SGD 400,000
  • Sales balance proceeds of BMW M5 worth SGD 174,300
  • Sales balance proceeds of Mercedes Benz E43 worth SGD 276,200
  • Sales balance proceeds of Aston Martin DBS Coupe worth SGD 338,200
  • Sale proceeds from property at St Martin’s Dr worth SGD 670,000
  • Sale proceeds from property at Suites@Braddell worth SGD 557,200

Earlier coverage of developments by Manifold Times regarding the Shell MGO bunker heist can be found below:

Related: Shell MGO bunker heist: Man sentenced to jail for hindering police investigations
Related: Shell MGO bunker heist: Bunker clerk gets jail time for helping Sentek acquire misappropriated fuel
Related: Shell MGO bunker heist: Bunker clerk pleads guilty to helping Sentek acquire misappropriated fuel
Related: Shell MGO bunker heist: Ex-Shell employees sentenced to more than 23 years in prison each
Related: Shell MGO bunker heist: Ex-Shell employees plead guilty to multiple offences
Related: Shell MGO bunker heist: Ex-Shell employee receives over 16-year jail sentence
Related: Shell MGO bunker heist: Ex-Intertek Surveyor sentenced to four months’ jail for corruption
Related: Shell MGO bunker heist: Ex-Intertek Surveyor pleads guilty to corruption charge
Related: Shell MGO bunker heist: Shell Process Technician receives 195-month jail sentence
Related: Shell MGO bunker heist: Police seize property, cars, watches from ex-Shell Bukom Process Technician
Related: Shell MGO bunker heist: Ex-Shell blending specialist jailed over USD 956,000 worth of misappropriated gasoil
Related: Shell MGO bunker heist: Former Intertek, Inspectorate surveyors receive fines, jail sentences
Related: Shell MGO bunker heist: Ex-CCIC Singapore surveyor pleads guilty to misconduct, receiving USD 12k in bribes
Related: Shell MGO bunker heist: Ex-Process Technician receives 184-month prison sentence over illicit involvement
Related: Shell MGO bunker heist: Syndicate member’s nephew jailed over concealment of safe containing valuables
Related: Shell MGO bunker heist: 12 former surveyors from Intertek, Inspectorate, CCIC, SGS charged for corruption
Related: Shell MGO bunker heist: Former Shore Loading Officer receives 29-year jail sentence over total 85 charges
Related: Shell MGO bunker heist: Ex-Process Technician received minimum SGD 735,000 in benefits, faces 43 charges
Related: Shell MGO bunker heist: Ex-Shell employee admits leading role in illicit operation
Related: Shell MGO bunker heist: Sentek ex-Director faces 40 fresh charges
Related: Shell MGO bunker heist: Two former Shell employees jailed over theft
Related: Shell MGO bunker heist: High Court affirms ‘Prime South’ forfeiture to Singapore State
Related: Shell MGO bunker heist: Three ex-Shell employees charged with bribing surveyors
Related: Shell MGO bunker heist: Second ex-Shell employee pleads guilty to nine charges
Related: Shell MGO bunker heist: First ex-Shell employee to plead guilty over involvement
Related: Shell MGO bunker heist: Director of Singapore bunkering firm released from police custody
Related: Shell MGO bunker heist: Oil tanker ‘Prime South’ forfeited by State Courts of Singapore
Related: Shell MGO bunker heist: Director of Singapore bunkering firm face charge at State Courts
Related: Shell Singapore oil heist: Third offender pleads guilty for gas oil theft
Related: Captain of “Prime South” jailed in Shell Pulau Bukom gas oil theft
Related: Shell Singapore oil heist: Ex-Chief Officer of Prime South jailed
Related: Singapore: Shell MGO bunker heist amount balloons to USD$142 million
Related: Shell MGO bunker heist update: Fresh charges issued at Singapore court
Related: Shell Singapore oil heist: More charges issued at court
Related: Shell Singapore oil heist: Breakdown of stolen oil cargoes
Related: Intertek Singapore employee among Shell oil heist suspects

 

Photo credit: Manifold Times
Published: 8 July 2025

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Vessel Arrest

Malaysia: MMEA detains tanker transporting 62,000 litres of diesel off Port Klang

Vessel was operated by a 43-year-old Indonesia captain with a crew of six Indonesians; captain failed to present any documents permitting the transport of the diesel which is a controlled item.

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Malaysia: MMEA detains tanker carrying 62,000 litres of diesel off Port Klang

The Malaysian Maritime Enforcement Agency (MMEA) on Friday (4 July) said it detained a tanker carrying 62,000 litres of diesel without valid documentation off Port Klang on 3 July. 

Selangor MMEA director Maritime Captain Abdul Muhaimin Muhammad Salleh said the tanker was detained at about one nautical mile west of Tanjung Harapan at 1.30pm during a routine patrol in Selangor waters. 

Initial checks showed the tanker was operated by a 43-year-old Indonesia captain with a crew of six, aged between 21 and 51, who were also Indonesians. All of them had complete identification documents. 

However, the captain failed to present any documents permitting the transport of the diesel cargo which is a controlled item. 

With that, a detention order was issued for the tanker. Both the captain and second engineer were arrested and were brought to the marine police jetty in Pulau Indah for further investigation. 

The case will be investigated under the Control of Supplies Act 1961 for failure to provide a permit or special licences from the Domestic Trade and Cost of Living Ministry to possess, store or transport controlled goods.  

 

Photo credit: Malaysian Maritime Enforcement Agency
Published: 7 July, 2025

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