Laytime and demurrage implications in voyage charter parties for chemical tankers: a case study of SASOL, South Africa.
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Date
2017
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Abstract
Background: Presently there are a limited number of standard Charterparties for the
shipment of chemicals in bulk in a voyage charter. Most of the existing Charterparties that
are presently being utilised were created for the oil tanker industry. Considerable similarities
exist in these Tanker Charterparty forms which can also be applied in the Chemical Tanker
environment.
Purpose: Existing standard Charterparties were analysed together with additional clauses to
determine whether there is an optimal Charterparty form that could cater for the
requirements in the Chemical tanker environment. Clauses of existing voyage Charterparty
forms were investigated and analysed as well as possible additional clauses. Particular
attention was paid to laytime and demurrage implications in order to propose an optimal
Charterparty arrangement which would be suitable for the bulk liquid chemical tanker
environment with minimum risk to the Charterer and Shipments (ex South Africa) from Sasol
South Africa.
Methodology: A comparative and exploratory approach and a case study approach is
adopted and carried out on selected, standard existing voyage Charterparties to provide an
in-depth understanding and interpretation of the laytime and demurrage implications in these
voyage Charterparties. A comparison of the differences in interpretation and meaning
between each standard voyage Charterparty was also computed. Thematic analysis was
used as a data analysis technique. The main theme impacting laytime and demurrage were
compared in each voyage Charterparty for similarities and differences. These common
themes in each Charterparty have been discussed and substantiated with case law. Through
exploratory and comparative studies an in-depth understanding, interpretation, differences
and similarities of the laytime and demurrage implications and clauses in each of these
existing voyage Charterparties was attained.
Findings: It was found that the Shellvoy6 and BPVOY5 Charterparties offer the least
exposure to demurrage, since for these Charterparties the demurrage cost calculated was
the lowest. This was constant for all routes.
The Asbatankvoy and Asbachemvoy Charterparties are the only Charterparties whereby the
principle of “once on demurrage, always on demurrage” can be enforced since their
exceptions are not extended to demurrage but only laytime and therefore if the vessel is
already on demurrage time would still count as used laytime for such exceptions.
The areas that do not protect a charterer’s interest include multiple berth discharge, awaiting
daylight, awaiting pilots, weather delays and pro rata of awaiting time for berth amongst all
charterers calling the same berth.
Including additional clauses to address these areas have resulted in additional savings for
demurrage and therefore, if included would benefit all the Charterparties that were included
in this study.
Contribution: The contribution of this study is to highlight the need for a Charterparty form
specifically designed for the chemical bulk liquid environment with special focus on risk
minimisation for the Charterer in terms of laytime and demurrage.
Description
Master’s degree. University of KwaZulu-Natal, Durban.