Sunday, 10 June 2012

Red tape leaves SA taxpayers liable in event of sea pollution

Government delays over key transport legislation have left South Africa with scant protection from a major ocean oil spill. This is despite several serious maritime accidents in the past three years.

The Department of Transport has yet to finalise access to the International Oil Pollution Compensation Fund, which would save taxpayers a fortune in the event of an oil pollution disaster.

The fund was established by an international convention signed in 2004 by South Africa. But it is still not part of South African law because the department failed to finalise domestic legislation drafted six years ago.

This means that if an oil tanker ruptured today on Clifton Beach, taxpayers could be liable for a massive clean-up bill as the country has no access to the Compensation Fund.

This has prompted an outcry from the maritime sector, including government's own Maritime Safety Authority (Samsa), which this week called for urgent action to prevent a potential environmental disaster.

There were two accidents near Cape Town last month, one involving a fishing trawler and the other a 250m bulk carrier with 80000 tons of iron ore and which is still anchored in False Bay.

"We are the ones who sit with a problem when there is a spill," said Sobantu Tilayi, Samsa chief operating officer.

"It is in our best interests to join [the international fund]. We have been pushing this thing for the past three years," Tilayi said.

This week the Sunday Times established that:

South Africa only qualifies for a maximum R180-million compensation payout from any ship that pollutes our shores;
The last two big international oil spills - Erika in 1999 and the Prestige in 2002 - resulted in claims of over R6-billion each;
If the draft legislation was finalised, South Africa could claim nearly R10-billion of liability insurance from the fund;
The draft legislation needed to activate the insurance cover is stuck between the Department of Transport and the National Treasury. There are issues over how to collect oil levies that need to be paid by SA oil importers to the London-based fund; and
There has been a surge in abandoned or "arrested" vessels berthed in local ports.

The need for protection via the fund was raised 16 years ago at a Maritime Policy Working Group. Since then shipping traffic rounding the Cape has rocketed to over 13 000 port visits a year.

SA has witnessed several shipping accidents, but to date no major spill has washed ashore. Recent accidents include:

The Turkish-owned bulk carrier Seli 1 washed up on Bloubergstrand in Cape Town two years ago;
The 164m oil tanker Phoenix, carrying 450 tons of crude, washed up on Sheffield Beach north of Durban last year. The salvage operation cost millions; and
In 1983 the Castillo de Bellver spilled 300 million litres of oil into the sea near Saldanha. The oil did not come ashore.

A modern oil tanker carries about two million barrels of oil. Oil tankers are often attacked by pirates near the Gulf of Aden and are rounding the Cape to avoid the dangerous route.

Department of Environmental Affairs spokesman Zolile Nqayi said: "At present, South Africa can only claim compensation for oil pollution damage within the financial limits set under the 1969 Convention."

Oil companies pay an annual levy into the fund, based on how much oil they transport. Most South African oil companies cannot contribute due to the absence of legislation or a payment mechanism.

University of Cape Town maritime law professor John Hare said all maritime countries except Canada allowed oil firms to pay levies direct to the fund.

"I don't know what the [SA] government's motives are in wanting to collect the money themselves. It just complicates a very simple situation."

Hare said the case of the Japanese trawler on Clifton Beach should have been a wake-up call. "If that trawler had been a tanker you could very easily have had claims topping R5-billion,'' he said.

Treasury spokesman Jabulani Sikhakhane said officials were working to ensure "speedy finalisation" of outstanding issues.

"Once approved by the ministers of Transport and Finance, the draft legislation will be submitted to Cabinet for approval."

The Department of Transport did not respond to queries.

- Times Live

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