Tamarind headache worsens as spill liability raised

MARITIME law expert Peter Dawson has revealed further complications due to Tamarind Taranaki’s messy bankruptcy and looming liquidation.
Tamarind headache worsens as spill liability raised Tamarind headache worsens as spill liability raised Tamarind headache worsens as spill liability raised Tamarind headache worsens as spill liability raised Tamarind headache worsens as spill liability raised

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Paul Hunt

Senior Journalist: Oil & Gas, Policy.

Paul Hunt

 

Dawson is the sole director at a small legal firm Dawson & Associates which specialises in New Zealand maritime and fisheries law. 

Speaking to Radio New Zealand this week, Dawson warned that there was a significant "grey area" surrounding the legal status of the Umuroa floating production storage and offloading vessel which was contracted by Tamarind to produce from the offshore Tui oilfield. 

"It's not clear to me whether this vessel would be regarded as a ship or as an installation and I'm not clear as to which legal regime would apply to the clean-up costs if the vessel would - god forbid - run aground and pollute the Taranaki coast," Dawson told Radio New Zealand. 

"The risk that I see is that the owner is now forced into the position where the vessel has to stay on the mooring the insurers may - in fact it was voiced in the judgement - the owner said that there's a risk that the insurers of the vessel would not continue to insure the vessel."

Decommissioning of the vessel is expected to take place after the winter season. 

Last year the Tamarind Taranaki went into voluntary administration, citing "a number of commercial factors." Not long after it went into liquidation and the decommissioning costs are at this stage expected to land at the feet of the Crown. 

The subsidiary, which had limited liability, owed hundreds of millions of dollars to contractors and creditors, including FPSO provider BW Offshore. Its parent company is headquartered in Malaysia, which has a separate subsidiary entity also operating in New Zealand. 

BW Offshore tried to tow its vessel from the field earlier this year, however the Environmental Protection Authority ordered it not to, concerned the wells would not be properly abandoned and plugged. 

The embarrassing demise of Tamarind has become a royal headache for the Crown and industry, with the oil and gas peak body quickly condemning the company's conduct and saying it was an isolated incident. 

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