Tung firm caught up in huge explosion aboard container

PUBLISHED : Sunday, 02 April, 2006, 12:00am
UPDATED : Sunday, 02 April, 2006, 12:00am

OOCL confident its cargo is not linked to blast that crippled the Hyundai Fortune

The Tung family shipping company has hazardous cargo aboard a South Korean ship burning abandoned off Yemen in what is expected to lead to the biggest maritime insurance claim in history.

Officials at Orient Overseas Container Line (OOCL) said they were confident after initial checks that its cargo was not linked to the massive explosion that crippled the Hyundai Fortune.

Insurers do not know the cause of the blast, but there has been speculation it was fireworks, chemicals, a terrorist attack or a mine. Salvagers now have most of the fire under control, according to reports, and are pumping water from the hold and the engine room.

The ship was fully loaded with 5,551 containers when its stern was ripped apart in a blast on March 21 about 70km off the Yemeni port of Aden. The explosion sent containers flying up and over the ship's bridge, crashing onto the main cargo decks. Its crew escaped with just one injury.

An OOCL official said the company had 200 containers on board the Fortune, two of which were filled with eucalyptus oil and registered as a low-grade danger. The containers were above deck towards the bow. Initial theories suggest the explosion started below deck towards the stern.

'Our initial investigations suggest we are in the clear,' the official said. 'Certainly, the insurance issues related to this are going to be very complex.'

OOCL was one of six international shipping firms with cargo on the ship, which had stopped in Taiwan, Hong Kong and Singapore before heading through the Middle East to Europe.

Other OOCL cargo included DVDs, electronics and textiles.

OOCL is a subsidiary of Orient Overseas International, in which the family of former chief executive Tung Chee-hwa holds a majority stake after his father founded the firm.

Firefighting tugs are still battling blazes on the ship, which is considered too dangerous for salvage crews and investigators to board.

Initial reports targeted seven containers full of fireworks, but shipping industry experts are warning it is too early to tell what sparked the explosion. Hyundai Merchant Marine has already banned further fireworks shipments following the blast.

Fireworks shipping expert Charles Weeth wrote in Lloyd's List that the explosion appeared to have started below deck - and not above, where fireworks are usually always stored. He also pointed out that modern fireworks are generally quite stable at sea.

Other sources have warned that other dangerous cargoes are far more unstable, including chemicals used in bleach that can ignite at tropical temperatures.

Initial estimates have put possible insurance claims at more than US$300 million. That figure is expected to rise as more than 7,000 bills of landing are scrutinised.