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Shell MGO bunker heist: Former Intertek, Inspectorate surveyors receive fines, jail sentences

A Duraisamy received a SGD 42,870.60 fine and 10-month jail sentence while Lee Been Lian was fined SGD 6,795 and received a two-month jail term due to offences under the Prevention of Corruption Act.

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Two former surveyors employed by Intertek Testing Services Pte Ltd (Intertek) and Inspectorate Singapore Pte Ltd (Inspectorate) received fines and jail sentences at the State Courts of Singapore on Monday (29 August) due to their involvement in the misappropriation of Shell gasoil at Shell Pulau Bukom, according to court documents obtained by Manifold Times.

A Duraisamy received a SGD 42,870.60 fine and 10-month jail sentence due to offences punishable under Section 6(a) of the Prevention of Corruption Act (Cap 241, 1993 Rev Ed) (PCA), which charges are combined under Section 124(4) of the Criminal Procedure Code 2010.

He first served as a surveyor at Intertek between 2013 to 2015 and was employed for a similar role by Inspectorate between 2016 to 2017.

Between 2014 and 2015, Duraisamy corruptly accepted total gratification of USD 15,000 (SGD 20,514) from Juandi bin Pungot to inaccurately report the amount of cargo loaded onto vessels which Intertek was engaged to inspect.

Sometime in April 2017, he accepted a bribe of USD 10,000 (SGD 14,070) from Richard Goh Chee Keong, the former Loading Master of Shell Eastern Petroleum Private Limited (Shell).

The bribes were for Duraisamy to omit inspection of non-nominated tanks and to falsely understate in his ullage reports the amount of cargo loaded onto receiving vessels. They were also for him to turn a blind eye and remain quiet about any misappropriation of Shell gasoil.

As a result of Duraisamy’s assistance in concealing the misappropriation of gasoil, three incidents of misappropriation of Shell gasoil (worth USD 1.78 million) went undetected by Shell between 2016 to 2017.

Lee Been Lian, who was surveyor employed by Intertek during the time of offence, was fined SGD 6,795 and received a two-month jail sentence due to offences punishable under Section 6(a) of the PCA.

Sometime in October 2017, Mr Lee received USD 5,000 (SGD 6,795) from Mr Goh in exchange for not inspecting the non-nominated tanks of a receiving vessel which loaded Shell gasoil without Shell’s authorisation.

The monies were also for Mr Lee to turned a blind eye to and keep quiet about any misappropriation of Shell gasoil.

His action of helping Goh and his co-conspirators conceal one incident of misappropriation of Shell’s gasoil resulted in Shell losing gasoil (worth USD 1. 20 million) during October 2017.

Notably, court documents highlighted Shell taking numerous “costly measures” to improve its systems and processes at Shell Pulau Bukom since the discovery of large-scale misappropriation.

These include:

  • Installation of new and additional custody transfer meters and anti-theft CCTV;
  • Development of a monitoring software to detect potential theft of gasoil;
  • Creation of new permanent positions to strengthen the supervision of key processes;
  • Focus on improving frontline staff performance.

By end 2020, the estimated cost directly incurred or to be incurred by Shell to manage the consequence of the long-term misappropriation, including the implementation of the measures detailed above, was in the region of SGD 6 million.

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

Related: Shell MGO bunker heist: Ex-CCIC Singapore surveyor pleads guilty to misconduct, receiving USD 12k in bribes
RelatedShell MGO bunker heist: Ex-Process Technician receives 184-month prison sentence over illicit involvement
RelatedShell MGO bunker heist: Syndicate member’s nephew jailed over concealment of safe containing valuables
RelatedShell MGO bunker heist: 12 former surveyors from Intertek, Inspectorate, CCIC, SGS charged for corruption
RelatedShell MGO bunker heist: Former Shore Loading Officer receives 29-year jail sentence over total 85 charges
RelatedShell MGO bunker heist: Ex-Process Technician received minimum SGD 735,000 in benefits, faces 43 charges
RelatedShell MGO bunker heist: Ex-Shell employee admits leading role in illicit operation
RelatedShell MGO bunker heist: Sentek ex-Director faces 40 fresh charges
RelatedShell MGO bunker heist: Two former Shell employees jailed over theft
RelatedShell MGO bunker heist: High Court affirms ‘Prime South’ forfeiture to Singapore State
RelatedShell MGO bunker heist: Three ex-Shell employees charged with bribing surveyors
RelatedShell MGO bunker heist: Second ex-Shell employee pleads guilty to nine charges
RelatedShell MGO bunker heist: First ex-Shell employee to plead guilty over involvement
RelatedShell MGO bunker heist: Director of Singapore bunkering firm released from police custody
RelatedShell MGO bunker heist: Oil tanker ‘Prime South’ forfeited by State Courts of Singapore
RelatedShell MGO bunker heist: Director of Singapore bunkering firm face charge at State Courts
RelatedShell Singapore oil heist: Third offender pleads guilty for gas oil theft
RelatedCaptain of “Prime South” jailed in Shell Pulau Bukom gas oil theft
RelatedShell Singapore oil heist: Ex-Chief Officer of Prime South jailed
RelatedSingapore: Shell MGO bunker heist amount balloons to USD$142 million
RelatedShell MGO bunker heist update: Fresh charges issued at Singapore court
RelatedShell Singapore oil heist: More charges issued at court
RelatedShell Singapore oil heist: Breakdown of stolen oil cargoes
RelatedIntertek Singapore employee among Shell oil heist suspects

 

Photo credit: Manifold Times
Published: 1 September, 2022

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Opinion

Gard: Charterparty considerations for wind-assisted propulsion

As wind-assisted propulsion is gaining traction as a means to decarbonise, there are contractual issues that should be sorted to avoid potential disputes between shipowners and charterers, says Gard.

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Maritime protection and indemnity (P&I) club Gard on Tuesday (5 November) published an insight on potential contractual issues in charterparty contracts for vessels using wind-assisted propulsion. The article was written by Jade Park, with assistance from Louis Sheperd and Neil Henderson:

While the industry continues its search for fuels that have less GHG emissions, the age-old method of utilising wind to propel ships is starting to come back into use with newer designs and technology. This is certainly a welcome development, but with new equipment comes new risks and responsibilities. If the risks are not adequately addressed in a charterparty, the good intentions to go green could quickly turn into a red-hot dispute. This article considers the impact of fitting wind-assisted propulsion systems (WAPS) on contractual arrangements between shipowners and charterers.

Time charterparties

Under a typical time charterparty, shipowners have the duty to maintain the ship whilst charterers have the obligation to provide and pay for fuel. This general position should not change due to the installation of WAPS. However, there are some specific issues that may arise from its installation which both parties should consider. Here are some of the contractual issues that should be considered when entering into a time charterparty:

Description of the WAPS installed. There are a number of different types of WAPS in the market. A full description of the type of wind propulsion, its capabilities, and when it can be used will help avoid any confusion and disputes. The description should also include details of what impact it may have, including any reduction in fuel use that may be achieved and in what conditions (this is likely to supplement the speed and consumption warranty). Also consider the WAPS’ impact on the vessel’s air-draft and if it may restrict the vessel’s berthing or other operations.

Installation. If the system is to be installed whilst the vessel is operating under a charterparty, the parties should determine who will pay the cost since this may have an impact on the ongoing hire rate. Further, the parties should consider how the benefits will be allocated. If there are joint contributions to the cost, how will that cost be allocated when the charterparty comes to an end?

Maintenance and repairs. Where shipowners and charterers have shared the cost of installing wind propulsion, the charterparty should clearly set out who is to be responsible for the cost of any periodic maintenance and/or repairs (including any loss of time). Otherwise, the default position will likely be that the burden lies with shipowners under the general maintenance clause.

Breakdown or malfunction. The parties should consider what is to happen if the WAPS breaks down or malfunctions. This will likely require the ship to burn more fuel to continue the voyage, or for the vessel to proceed at a slower speed to achieve the same consumption. The charterparty should clarify which party is to bear the cost of the additional fuel burned or time taken. It should also set out whether the breakdown or malfunction is an off-hire event and if so, how it should be calculated. Another alternative to off-hire could be to have two rates of hire; one for when the system is in use and another for when it is not available for certain agreed reasons. Also consider what rights the owners or charterers may want to have as regard performance during a period of breakdown. For example, if the propulsion system was expected to reduce fuel consumption by 10% in certain conditions, should owners have the right to reduce speed in order to achieve the same consumption?

Performance warranties. The wind propulsion will be installed with the aim to improve the ship’s fuel consumption and possibly its speed as well. The ship’s performance warranties may therefore need updating where wind propulsion is being retrofitted. It may also be necessary to have separate warranties for when the wind propulsion has broken down and the ship is solely propelled by conventional fuel. If different warranties are given for different weather conditions, then consider where evidence of the weather conditions is to be taken. The system may have sophisticated sensors that are more likely to be accurate of the real weather conditions than a weather routing company.

Voyage charterparties

Under voyage charterparties, matters related to bunkers and maintenance typically rest with shipowners. As such, there are fewer implications for voyage charterparties if installing wind propulsion. However, there are some matters that the parties may wish to consider:

Vessel description. It may be necessary to consider whether the WAPS restricts the ports/berths that the vessel can use.

Laytime/demurrage provisions. The running of laytime/demurrage may be disrupted by the breakdown or malfunction of the wind propulsion. Any provisions in the charterparty pertaining to laytime/demurrage, including exceptions to laytime or demurrage running, may need to be adjusted to address what is to happen in such an event.

Due dispatch obligations. Parties should determine what rights they want to have in the event of the breakdown of the WAPS on a voyage. Must the vessel increase the engine’s speed to make up for lack of extra propulsion, or is it permissible for the vessel to slow down to achieve the same emissions without being in breach of the due dispatch obligation?

 

Source: Gard
Photo credit: Aymane jdidi from Pixabay
Published: 11 November 2024

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Vessel Arrest

Malaysia: MMEA detains tanker in Sekinchan waters for anchoring illegally

Investigations found that 13 crew consisting of six Myanmar nationals, four Bangladeshis and three Indonesians, were on board the tanker when detained.

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Malaysia: MMEA detains tanker in Sekinchan waters for anchoring illegally

The Malaysian Maritime Enforcement Agency (MMEA) on Thursday (7 November) said it has detained a tanker for anchoring without permission in Sekinchan waters. 

Selangor MMEA director Captain Abdul Muhaimin Muhammad Salleh said the tanker was detained by a MMEA patrol boat at 9.6 nautical miles southwest of Sekinchan at 5 pm on that day.

Investigations found that 13 crew consisting of six Myanmar nationals, four Bangladeshis and three Indonesians, were on board the tanker when detained.

Further examination of the documents found that the ship's captain failed to present any documents for permission to anchor.

The ship's captain, 56, and chief engineer, 39, have been taken to Selangor MMEA Headquarters for further investigation.

The case is being investigated under Section 491B (1) (l) of the Merchant Shipping Ordinance 1952.

 

Photo credit: Malaysian Maritime Enforcement Agency
Published: 8 November, 2024

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Legal

Four Dutch seafarers charged for alleged roles in causing Singapore oil spill

Four men on Netherlands-flagged dredger “Vox Maxima” were charged under Merchant Shipping Act 1995 on 6 November and will appear in court again on 4 December.

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Martin Klingsick / MarineTraffic

Singapore has brought charges against four crewmen who were working on Netherlands-flagged dredger Vox Maxima for their alleged role in causing the disastrous bunker spill into the republic’s sea, according to a report by The Straits Times on Wednesday (6 November).

Singapore-flagged bunker vessel Marine Honour was hit by Netherlands-flagged dredger Vox Maxima at Pasir Panjang Terminal on 14 June, which resulted in an oil spill in Singapore waters.

The dredger reportedly lost engine and steering control before crashing Marine Honour.

The four men, all Dutch nationals, – Merijn Heidema, 25; Martin Hans Sinke, 48; Richard Ouwehand, 49; and Eric Peijpers, 55 – allegedly failed to ensure that emergency steering was carried out when emergency power was supplied to the vessel’s steering gear pumps, resulting in the allision. 

They were each charged under the Merchant Shipping Act 1995 on 6 November. 

Heidema and Peijpers, who were responsible for the engineering watch, were accused of failing to ensure a sufficient reserve of power was available for Vox Maxima’s steering gear when the engine room was put in a standby condition.

Their cases have been adjourned to 4 December.

Manifold Times previously reported Vox Maxima was found to have serious deficiencies relating to fire safety and life-saving equipment aboard. 

A total of 13 deficiencies were flagged during the 15 June inspection of the dredger. Three out of the 13 warranted detention of the vessel which indicated serious deficiencies that required repairs before it could be permitted to leave the port. 

Related: Thirteen deficiencies flagged during inspection for dredger involved in Singapore oil spill
Related: Singapore oil spill: Minister refutes claim that contractor was slow in preventing further spillage
Related: MPA: Claims exceeding liability of “Marine Honour” owner will be made against international fund
Related: MPA: Owner of bunker tanker involved in Singapore oil spill is liable for pollution damage
Related: Malaysia to look into demands of Johor fisherman affected by oil spill from Singapore
Related: Singapore oil spill: Clean-up enters next phase of cleaning rock bunds
Related: MPA: Clean-up ops continue following oil spill in Singapore, affected beaches closed
Related: Singapore: Oil spill cleanup after allision between dredger “Vox Maxima” and bunker tanker “Marine Honour”

 

Photo credit: Martin Klingsick / MarineTraffic
Published: 7 November, 2024

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