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31st July 2018

Stop charging tankers more for everything

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Maritime response organisations often charge tankers a premium, but whatever justification there may be for hiking the prices for some response services (e.g. oil spill response), tankers should not be charged an inflated rate for media response.

It appears that many tanker operators are so used to paying a little more for almost everything that they don’t question a quote for media response services that blatantly charges them more for the tankers in their fleet.

Tanker owners/managers need to start demanding fair pricing.

Navigate Response charges the same fees for all vessel types, regardless of the cargo. Our only exception is passenger vessels, because people are the only cargo that talks back and for media response that matters.

With that said, what are the excuses used to charge more for tankers?

  • More media response time will be required for a tanker incident? Not necessarily. Every incident is different and any vessel type can be involved in a highly demanding incident. The top of the list of expensive P&I claims doesn’t belong to tankers, but rather to a passenger and a container vessel.
  • Being on standby for a tanker is more demanding? Not for media response. If we were warehousing booms, dispersants and other response equipment, then this might be the case, but for media, being prepared to deal with a PCTC incident requires the same effort as being prepared for a VLCC incident.
  • There are more drills and exercises for tankers? In most cases this is true, but I’m unclear how it justifies a higher cost. Many providers charge extra for participation in each drill (we don’t), and even if drills are included (as they are for our clients) they are rarely a significant time demand. We are actually working to make drills more demanding as we feel that many drills are not taken seriously enough, but that’s a topic for another day.
  • Charterers are more likely to demand media cover for tankers? In our experience this is true, and it’s probably the root of the practice of charging more, but it doesn’t justify it. Tanker owners are under more pressure to pay for media response, and therefore, they can be forced to pay more, but that doesn’t make it right.

Market forces should address the issue I’m raising here, but in our industry, there is surprisingly little competition for response services and many companies don’t bother to meaningfully shop around. This complacency has allowed unjustified pricing structures to persist for decades. If you haven’t benchmarked your current media response provider in a while, you may be part of the problem.

 

Dustin Eno
COO & Crisis Response Manager

T: +44 (0)20 3326 8467
E: dustin.eno@navigateresponse.com

Twitter: @dustineno

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