Initial agreement reached between Suez Canal, Ever Given Ship over six-day blockage compensation

Mohamed Soliman , Wednesday 23 Jun 2021

The SCA has not commented yet on the announcement, which comes three days after a hearing in the case was adjourned for further negotiations

Ever Given
File Photo: Ever Given sailing freely through the Suez Canal taken on 29 March 2021. Al-Ahram

An initial agreement has been reached between the Suez Canal Authority (SCA) and the owner of the Ever Given ship, which ran aground and blocked Egypt’s Suez Canal in March, UK Club — an insurer for the giant vessel — announced.

“The UK Club is pleased to announce that, following extensive discussions with the Suez Canal Authority’s negotiating committee over the past few weeks, an agreement in principle between the parties has been reached,” the insurer said in an official statement on Wednesday.

“Together with the owner and the ship’s other insurers, we are now working with the SCA to finalise a signed settlement agreement as soon as possible,” it added without providing further details.

The UK club said once the formalities have been dealt with, arrangements for the release of the vessel will be made.

The Ever Given, which was refloated on 29 March by a fleet of Egyptian tugboats and diggers, has since been anchored in a lake between two sections of the canal at a court’s request, with an exchange of blame over which party was at fault over the crisis.

The mega-ship has been caught in a legal dispute linked to an initial $916 million compensation claim made by the SCA against the ship’s Japanese owner.

The SCA, however, had offered to slash its compensation claim 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 Ever Given’s insurers had said the demanded sum is still too high, previously offering to pay $150 million in compensation for the six-day traffic halt.

On Sunday, an Egyptian court postponed a hearing in the case filed by the Suez Canal Authority against the owners of the Ever Given vessel for further negotiations to “amicably” settle the dispute.

The SCA has yet to comment on the announcement.

However, SCA lawyer Khaled Abu-Baker said on Sunday that the adjournment request was submitted, as both sides “reached an agreement on some points during the negotiations,” hinting that offers that may meet the SCA’s demands have been received.

Faz Peermohamed of Stann Marine, the representative for the owners and insurers, said on Sunday following the hearing's adjournment that “positive working sessions, negotiations are taking place between us, the UK P&I Club, and the committee assigned by the Suez Canal Authority.”


“We agreed that the details of such negotiations would remain confidential. During the negotiations, we submitted a proposal that we believe satisfies all the requirements of the SCA,” Stann said in a separate statement.

Last month, the SCA rejected claims by the UK Club that the speed of the Ever Given was controlled by the canal’s operator before it ran aground in the canal.

The SCA said that exceeding set speeds at the country’s strategic canal is the sole responsibility of the ship’s captain.

The ship insurer’s statement came in response to statements by SCA officials that the ship was sailing “too fast” and that the error was entirely the responsibility of the Ever Given’s captain and not that of the canal’s operator, whose opinion is “non-binding”.

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