Egypt offers to cut compensation claim of impounded Ever Given vessel to $550 million

Mohamed Soliman , Monday 24 May 2021

This is the second reduction after a $916 million compensation was first demanded for the losses incurred from the six-day blockage of the Suez Canal

Ever Given
Ever Given ship

Egypt has offered to cut compensation claims from the owner of the impounded Ever Given vessel, which blocked the Suez Canal for six days in March, to $550 million to settle the current judicial dispute, with the mega-ship to be allowed to leave if nearly 40 percent of the sum is paid in cash.

The Suez Canal Authority (SCA) reduced the claims for compensation from $600 million to $550 million after being informed of the actual cost of the cargo containers loaded on board, Osama Rabie, the SCA head, said on TV on Sunday.

Rabie added that the SCA had first set an initial estimation of the overall cost of the ship's cargo at more than $3 billion, but according to the ship owner the cargo is worth $775 million.

The skyscraper-sized ship will be allowed to sail anew, said Rabie, if a $200-million instalment of the required compensation is paid in cash and a guarantee letter from an Egyptian bank is submitted to ensure that the remaining sum will be paid later.

This is the second discount the SCA has offered after it had first demanded $916 in compensation for the losses incurred from the six-day blockage of the strategic waterway.

The 400-metre-long ship had run aground across the canal on 23 March and was refloated on 29 March by a fleet of Egyptian tug boats and diggers, with the assistance of the tide.

The vessel has since been anchored in a lake between two sections of the canal.

In April, an Egyptian court ordered the mega ship be impounded after Shoei Kisen, the Japanese ship owner, refused to pay the required sum.

Rabie's statement came after an Egyptian court refused on Sunday an appeal filed by the ship owner against the order issued in April, allowing the SCA to keep the vessel impounded. 

The SCA said the sum only covers the losses incurred by the six-day blockage and the cost of refloating attempts.

He pointed out that an Egyptian engineer lost his life during the dislodging attempts.

Shoei Kisen argued that the SCA had been at fault for allowing the ship to enter the waterway during the bad weather, one of the lawyers representing the ship owner's legal team told Reuters.

It also said the dislodging efforts are part of the SCA's duties, claiming $100,000 in initial compensation for losses due to the impounding order.

Rabie refuted the claims, stressing that the canal has experienced harsher weather conditions without accidents. 

"Assessing the weather conditions falls within the responsibilities of the ship's captain," he said.


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