6 BULKDISTRIBUTOR Tank Containers
May/June 2020
TT Club outlines
tank chain risk
management
The intermodal transport of bulk liquid
and solid cargoes can present operational
challenges for all stakeholders in the
transport chain.
Insurance mutual TT Club published a lengthy
report* in April outlining some of these
challenges.
Through analysis of claims experience, the club
can identify a number of common errors and
misconceptions, which can result in the
deterioration or total loss of the cargo and
damage to the equipment itself.
This document is intended to be a practitioner’s
good practice guide covering all stakeholders
through the tank transport chain whether
operating, filling, discharging or handling tanks.
Walking readers through issues such as
regulations, equipment selection, corrosion and
final mile delivery, the report devotes considerable
space to actions in the event of an incident.
While the tank is recognised as the safest means
of transporting bulk liquids, there are occasions
where incidents occur which may give rise to
insurance claims.
Such incidents are relatively few in number, but
given the nature of some of the cargoes being
transported, there is the risk of potentially large
exposure incidents. The report goes on to highlight
the safety features of the tank and provide good
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practice guidance in the event of an incident.
Typical safety features include the thermal
insulation layer of the tank which shell provides, in
addition to its thermal qualities, a degree of
protection in the event of an impact.
Flame guards and bursting/frangible discs are
fitted to vacuum relief devices and spring-loaded
valves to mitigate the risks where tanks are
exposed to external fire incidents.
The bottom discharge valves comprise of three
closures in series; the internal spring-loaded foot
valve, the outlet valve and a screwed sealing cap
or flange. In the event of a catastrophic damage to
the external portions of the bottom discharge
valve, the outlet valve support pipe is designed
with a shear groove allowing the external part of
the valve to shear from the tank leaving the tank
barrel and the internal valve intact and containing
the cargo.
A safety valve is provided in the top of the tank
to relieve excess pressure that might build as a
result of a cargo chemical reaction or overheating.
The many safety features of the tank are such
that even in the event of reasonably serious
damage incidents, the cargo is contained within
the barrel and therefore the integrity of the cargo
is maintained. If the damage sustained results in
the frame of the tank no longer conforming with
CSC safety criteria, it may not be possible for it to
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While the tank is recognised as the safest means of
transporting bulk liquids, there are occasions where
incidents occur which may give rise to insurance claims
continue its intended transport. There may be the
need to tranship the cargo into a replacement
tank, ensuring compliance with all loading and
regulatory requirements.
Leaking cargo
Where tanks are severely damaged, cargo may
leak from the barrel. In such circumstances, where
practicable, the leak should be stemmed, or if not
possible, the tank placed in a leak tray, bunded
area (walled concrete surfaced area) or surrounded
with containment boom/bund to ensure that the
cargo is contained – preventing a wider pollution
risk.
The type of cargo being carried will influence
how those responding to the incident will be able
to proceed and the level of personal protective
equipment (PPE) they may require. The type of
cargo will also influence how the surrounding
areas should be managed; areas may need to be
evacuated if it is assessed that they might be
exposed to danger.
Contamination
The most common type of loss relates to cargo
contamination, including where the cargo does
not meet the specification expected by the
consignee. These incidents arise for a number of
reasons, often not directly attributable to the tank
itself.
Occasionally the stubborn remnants of a prior
cargo will be freed by an aggressive Class 8 cargo
and show in the pre-discharge samples at the
consignee. Pre-discharge samples indicating
problems may include discolouration or the
presence of suspended particles. These particles
may be attributable to a prior cargo or an
incompatible component.
Where contamination cases are concerned, early
and transparent interaction with the cargo owner
will encourage a positive handling of the incident
which can result in early resolution. The solution
to many cargo contamination incidents is
reasonably cost-effective filtering or reworking.
However it is imperative that the cargo interests
are involved in the early stages of the investigation
in order to encourage them to take such action.
Injuries for those working with tanks are few in
number; however, when they occur, they can have
serious consequences and come in two major
categories: risks associated with confined spaces
for those working inside the tank barrel can be
high if the correct equipment is not available or
used and confined entry permit procedures are
not strictly followed; and working at height.
Crisis management
When considering risk assessment and
management it is generally good practice for all
stakeholders in the tank supply chain to have a
robust crisis management plan in place which is
tested periodically, the document states. This plan
should also consider an emergency response plan
in the event of a catastrophic incident.
Post incident, stakeholders need to scrutinise the
physical and contractual chain to identify (if
possible) where the error has occurred with a view
to holding the responsible party liable at an early
stage.
At the earliest practicable opportunity following
the discovery of an issue (once any immediate risk
is contained and under control) the priority should
be to notify your liability insurer, and consider the
early appointment of an independent surveyor/
expert. Depending on the type and seriousness of
the incident early action investigating and
gathering relative information will assist in
mitigating the potential loss and liability.
*Stop Loss 22 - Tank Containers. Managing risk
in the tank container supply chain
www.ttclub.com
Stolt results slip back
Stolt Tank Containers reported first-quarter revenue of US$129.4 million, down from $133.4
million in the fourth quarter 2019, which included approximately $4 million of additional
demurrage and ancillary revenue from one-time catch-up billings related to global accounts.
Despite continued price competition, first-quarter transport revenue increased by 3.4 percent, driven by
a 1.5 percent increase in total shipments and an increase in the proportion of higher revenuegenerating,
inter-regional shipments. The total number of tanks in STC’s global fleet —owned, leased
and managed assets — was essentially unchanged.
Operating profit was $6.7 million, down from $15.7 million in the fourth quarter. The decrease was
partly attributable to the prior quarter’s one-time $4 million increase in demurrage and ancillary revenue.
STC further saw a $3 million increase in ocean-freight related to low-sulphur fuel surcharges, which was
not fully recovered from customers, and an increase in repositioning costs of $0.9 million.
www.stolt-nielsen.com