MV Khalijia will continue to lie in harbour

Despite receiving a highest bid of Rs18 crore, the damaged MV Khalijia III’s sale could not be confirmed and it will continue to remain in the city harbour for some more time.

Despite receiving a highest bid of Rs18 crore, the damaged MV Khalijia III’s sale could not be confirmed and it will continue to remain in the city harbour for some more time.

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Advocate Birendra Saraf, who is representing Micky Shipping Ltd, the highest bidder for the merchant vessel, on Wednesday told the Bombay high court that the Mumbai Port Trust has “suddenly” sought unlimited insurance cover for any further oil pilferage while removing the vessel.

MV Khalijia III was involved in a collision with a cargo ship off the Mumbai coast in August last year, resulting in a major oil spill.
Saraf added that the sale of the damaged vessel to his client could not be confirmed because of this unexpected demand. The damaged vessel still contains nearly 400-500 tonnes of oil.

Saraf also pointed out that no Indian company offers such an insurance cover and, therefore, the Mumbai sheriff’s office would then be required to opt for some international firm so as to fulfill the demand.

Smit Singapore, which had salvaged the cargo from Khalijia III when it met with another accident in July 2010 and ran aground, has moved the court seeking interim order to protect its interest until an international arbitration tribunal at London decided on its dispute with the owners of Khalijia —Gulf Rocks KSC.

The Singaporean firm has sought recovery of around $3 million from Gulf Rocks KSC towards salvage charges.

Acting on its plea, in March 2011, a single judge bench of the high court had stayed the scheduled sale of Khalijia III. However, four days later, the court cleared the way for the sale. Bids were invited and Micky Shipping placed the highest bid of Rs18 crore for the damaged vessel.

The Mumbai Port Trust has also raised claims of more than Rs15 crore saying the collision between the two cargo ships — MV Khalijia III and MSC Chitra — had resulted in damages to the port, apart from anchorage charges of Rs64 crore from MV Khalijia III.