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MSC Says It Will Pony Up to Avoid General Average in Maersk Elba Fire

MSC Says It Will Pony Up to Avoid General Average in Maersk Elba Fire
MSC Mediterranean Shipping Company is taking the unusual step of covering costs related to the fire on board the Maersk Elba in order to avoid General Average.

The Maersk Elba was carrying cargo for MSC customers when it suffered an engine room fire that left the ship disabled off Portugal on December 26. The fire was extinguished and the vessel was able to anchor about 2 miles off the coast of Sagres before tugs eventually towed it to Algeciras, Spain.

The Maersk Elba is operated by Maersk, MSC’s partner in the 2M Alliance vessel sharing agreement. It was operating on MSC’s Shogun Service connecting Asia with North Europe and was underway from Colombo, Sri Lanka to Felixstowe in the U.K. at the time of the fire.

“Exceptionally, on this specific occasion, MSC has taken the decision to cover the costs so that the vessel operator will not declare General Average. This decision was taken to avoid additional costs or delays for our customers as a result of this incident,” MSC said in a notice to customers dated January 18.

“The ship is currently in Algeciras undergoing temporary repairs from where it will continue directly to Wilhelmshaven, Germany, where cargo will be off-loaded. The ETD is still to be confirmed, but it is currently expected to be 20 January. MSC understands that Maersk is planning to arrange feeder vessels for onward carriage of cargo from Wilhelmshaven to Felixstowe and Rotterdam.”

General Average requires that the shipowner and its customers share a proportionate amount of the costs associated with saving a vessel after a major casualty. When General Average is declared, cargo owners are required to contribute to a GA fund before cargo can be released.

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