Hebei Spirit

Republic of Korea, 7 December 2007

Report updated 17 February 2009

 

What has happened?

On 7 December 2007, the Hong Kong registered tanker Hebei Spirit (146 848 GT), laden with 209 000 tonnes of crude oil, was struck by the crane barge Samsung Nº 1, whilst at anchor about five miles off Taean on the west coast of the Republic of Korea. About 10 500 tonnes of crude oil escaped into the sea from the Hebei Spirit.

The oil polluted, in varying degrees of contamination, three of the four provinces along the western coast of the Republic of Korea. Clean-up operations were carried out at sea and are still continuing along the shoreline, where more than 375 kilometres has been affected. The removal of the bulk oil was completed by the end of March 2008. The major part of secondary clean-up operations, involving, among other techniques, surf washing, flushing and hot water high-pressure treatment, were completed by the end of June 2008. Some clean-up operations in remote areas are still ongoing and expected to be completed shortly.

The 1992 Fund together with the shipowner's insurer, the Assuranceföreningen Skuld (Gjensidig) (Skuld Club), have appointed a team of Korean and international surveyors to monitor the clean-up operations and assess the potential impact of the pollution on fisheries, mariculture and tourism activities.

The compensation system: who pays?

The Republic of Korea is a party to the 1992 Civil Liability Convention (1992 CLC) and the 1992 Fund Convention, which form part of Korean Law. Under these instruments, compensation is available to any individual, business, private organisation or public body which has suffered pollution damage as a result of the Hebei Spirit incident. The Republic of Korea is not a Party to the Supplementary Fund Protocol.

Compensation is payable for expenses actually incurred and for loss or damage actually suffered as a result of the oil pollution. All claims must be properly supported by documentation - a well-substantiated claim can be processed much more quickly than one which is not.

The compensation available from the shipowner's insurer, the Skuld Club, under the 1992 Civil Liability Convention Additional compensation is 89.77 million SDR (£95 million). Additional compensation of up to approximately £119 million (113.23 million SDR) is available from the 1992 Fund. In other words, the total amount available for compensation under the 1992 CLC and the 1992 Fund Convention is 203 million SDR (KRW 321 618 990 000 or £214 million).

Special Law for the Support of Affected Inhabitants and the Restoration of the Marine Environment in respect of the Hebei Spirit Oil Pollution Incident

The Korean Government has informed the 1992 Fund that a Special Law for the support of the victims of the Hebei Spirit incident was approved by the National Assembly in March 2008. Under the provisions of the Special Law, the Korean Government was authorised to make payments to claimants based on the assessments made by the Skuld Club and the 1992 Fund and therefore claimants could receive compensation in full for the losses suffered as a result of the incident based on the assessments of claims by the 1992 Fund and the Skuld Club. The Special Law entered into force on 15 June 2008.

In June 2008 the Korean Government informed the 1992 Fund that, in accordance with the Special Law, if the 1992 Fund and the Skuld Club paid claimants compensation on a pro-rata basis, the Korean Government would pay the claimants the remaining percentage so that they would be paid 100% of their claims as assessed by the 1992 Fund.

Claims Office

The 1992 Fund and the Skuld Club have established a claims office in Seoul ('the Hebei Spirit Centre') to facilitate the prompt handling of claims for compensation and to assist claimants in the presentation of their claims. Claimants are invited to contact the Hebei Spirit Centre to obtain guidance on the submission of claims.

The contact details are:

Hebei Spirit Centre
K.P.O. Box 2242
Seoul 110 110
Telephone: (+82) (02) 767-2693
(weekdays from 1:00pm to 5:00pm only, excluding public holidays)
Fax: (+82) (02) 767-2694
Email: Hebei.Spirit@pandi-centre.com

Level of Payments

In June 2008 the Executive Committee, based on a preliminary estimation by the Fund's experts that the total amount of the losses to arise from the Hebei Spirit incident was likely to exceed the amount available under the 1992 Civil Liability and Fund Conventions and in view of the uncertainty as to the total amount of the potential claims, decided to set the level of payments at 35% of the established claims.

In October 2008, the Executive Committee noted that the most recent estimate by the 1992 Fund's experts of the total amount of the losses caused by the spill was between KRW 566.3 billion and KRW 601.3 billion (£272-289 million) and on the basis of this information the Executive Committee decided to maintain the level of the 1992 Fund's payments at 35% of the amounts assessed by the Club and the Fund, to be reviewed at its next session.

Claims situation

As at 7 October 2008 claims for compensation totalling KRW 242 077 589 824 (£109 million) have been submitted as a result of the incident. One hundred and two of these claims have been assessed at KRW 33 918 million (£15 million). The other claims are being assessed. Further claims are expected.

Investigation into the cause of the incident

On 4 September 2008, the Incheon District Maritime Safety Tribunal issued its decision with regard to the cause of the incident. The Court ruled that both Samsung tugs and the Hebei Spirit were at fault in causing the collision. The Court further found that the Master and the Duty Officer of the Hebei Spirit were also partly liable for the collision between the Hebei Spirit and the Samsung Nº 1.

A number of defendants, including Samsung Heavy Industries, the Masters of the tug boats and the Master and Duty Officer of the Hebei Spirit have appealed against the decision to the Central Maritime Safety Tribunal.

Recourse action