"Liability Issues and Rough Weather Hamper Salvage Operationn"

June 27, 2007

The Kaselehlie Press

Captain Lance Higgs has by his own accounting made a thousand or more journeys into and out of Pohnpei's Sokehs Harbor, the FSM's main port of entry. He may have been speaking figuratively but he still has considerable experience. Higgs is the 26 year veteran skipper of the Thorfinn, a live aboard dive vessel out of Chuuk. On Friday afternoon, June 8 for the first time in the Thorfinn's career something went wrong and she is hard aground on the reef just outside of the main pass.

Trying to explain the situation in a way that we might understand, he said that the situation was similar to being involved in a car wreck on the street you live on. "You know every telephone pole, every tree, every obstacle and then one day a girl in a miniskirt is walking by and you look for just a moment and 'boom', you hit a telephone pole." Of course there are no girls in miniskirts in the harbor but he said the situation was similar to that. There was a distraction and now, he and the Thorfinn sit in full view of those who care to look on-to the Captain's great discomfort.

As he was leaving the harbor he received a radio call. The west side of the channel has an ocean side reef edge that requires west heading boaters to make a northeasterly swing before heading west. Higgs set his autopilot for a westerly course a bit early and went to the radio room to answer the call. He said the engine hesitated for a moment and shortly thereafter he heard a loud bang. The vessel had struck the outside edge of the reef. Thorfinn was designed as an icebreaking whaler for operations in the Arctic. Despite the extremely heavy construction for those duties, the reef tore a hole in the wall of the engine room and the ship began taking on water.

Higgs said that there was very little choice. He had to put the Thorfinn on the reef to avoid sinking in the channel and causing a worse problem than currently exists. Considering its load of over 80,000 gallons of waste oil that is essentially the consistency of diesel fuel, that it uses to fire its boilers, it's a significant problem indeed. The vessel sat for days on sandy bottom listing 15 degrees or more to starboard, the right side, with ocean swells pouring over its deck. The entire first deck is full of water. There has been oil leakage from the engine room itself but so far the completely full tanks are not leaking.

Approximately 35,000 gallons of the waste oil aboard the vessel came from Pohnpei Utility Company's power plant. Thorfinn is a steamer and so it can burn nearly anything that burns hot enough to give them steam including wood which is what Captain Higgs says they will initially use to try to cleanse the salt water from the lines.

Saipan authorities have been all but begging the Thorfinn to come and take some of its 350,000 gallons of oil currently stored in tanks that are near the bursting point. Higgs said that it simply can't enter the Saipan harbor because of U.S. standards of operation that the Thorfinn isn't equipped to meet. Saipan could bring a tanker in to remove the oil but they not only would have to pay for the hugely expensive tanker, they would have to pay for a remanufacture of the oil. They've done it before but it cost so much that they have ruled that out as a solution. If not for the Thorfinn, all of the electrical utilities in the FSM would likely have the same problem as Saipan and the already high rate of electricity in the FSM would have to increase. The country would not only have to pay for acquisition of fuel, they would also have to pay to dispose of the waste it produces. Right now the utilities pay nothing to rid themselves of it.

The Dang Dilemma a cargo vessel out of Japan made in the mid 90's essentially the same mistake as Captain Higgs and in the process scooped out a large section of the reef. It's possible that the sandy bottom in the place where the Thorfinn is sitting was caused by that grounding. Just as in the case of the Thorfinn there was a large amount of oil on the Dang Dilemma.

The Dang Dilemma, however, was carrying heavy oil the consistency of crude oil. The Governor at the time declared a state of emergency and the Coast Guard was called in to assist along with several independent salvage companies. Pohnpei Port Authority has no equipment to deal with salvage operations. They have a check list that was developed during a recent FAA desktop exercise but no equipment to directly assist in salvage operations. Port director Ieske Iehse said that funding for the port is hard to come by and the Port was hoping that someone from the private sector might find salvage operations profitable enough to invest in them in Pohnpei.

Higgs said that many vessels end up on the reef or in shallow water at one point or another. He said that every government vessel has at some time or another hit a reef. A salvage and rescue operation might indeed be lucrative in the FSM. Adams Brothers Construction, a local construction company was chosen to get the Thorfinn salvage operation underway. The company is the only local operator that has the equipment and manpower to take care of the problem of the Thorfinn.

Though they could not begin the actual salvage until liability issues were cleared they did install a temporary patch on the hole in the engine room wall that minimized the leakage even if it did not entirely resolve it.

On Wednesday, June 13, newly appointed Chairman of the EPA Board of directors, Ferny Perman, having only heard about the "Thorfinn problem" on Tuesday evening and then not from the EPA, camped out in the Pohnpei State Attorney General's office waiting for the office to execute a hold harmless agreement to protect Adams Brothers from lawsuits if something went wrong while he was performing the salvage. The Governor signed the waiver but that was only part of the negotiations that needed to be arranged.

According to Attorney Fredrick L. Ramp, attorney for the insurance company that insures the vessel there were very complex issues of liability to resolve. Additionally he said that salvages of this magnitude might cost multiples of a hundred thousand dollars and that all options had to be considered.

The EPA, lawyers for the insurance company, lawyers for the Adams Brothers, and lawyers for the Thorfinn finally came to agreement on the liability issues on June 18. Ramp said that one issue came up over night but it was resolved by morning and work started on the 19th.

Larry Adams of Adams Brothers said that the first thing they had to do was rebuild the patch so that it sealed better. The position of the hole made that operation difficult and left them only a bit more than a foot of space to apply the heavy steel patch which made it difficult for scuba divers to get the job done. The operation was compounded by engine room oil leaking from the vessel that nauseated the divers.

On Wednesday, the Adams Brothers barge which had been thoroughly inspected by Allied Marine of Guam and certified to be seaworthy and watertight was towed to the Thorfinn and began pumping the oil out of the vessel. Before it became too dark to operate, the pumping operation had retrieved approximately 10,000 gallons of the oil and the Thorfinn now sits flatter on the water. The barge is being towed by one of the skiffs from a fishing vessel currently in port. The skiff developed mechanical problems late in the week and the barge has not yet been able to return to work. Other options are being sought.

Another legal problem developed on Friday, June 22 that has stopped the salvage operation. All of the parties involved had made agreement on where liabilities lay except for one-PPA. When the parties involved in rescuing the Thorfinn were approached by PPA about who would be held responsible if after they pull the vessel from the reef it sinks while entering the port they brought a stack of papers for legal counsel to review that asked PPA to hold the parties harmless. A vessel the size of the Thorfinn sinking in the channel would effectively shut down the port. Since PPA's responsibility is for the safety of the Port they want agreements from the operators that they will be held responsible if after entering the port the vessel sinks.

Legal Counsel for the Port Authority said that if they signed an agreement releasing the parties from responsibility and something catastrophic happened they would be held financially responsible for potentially millions of dollars of damages. Iehse said that they may be filing a complaint with the Thorfinn for violation of Port regulations. When asked if the Thorfinn might be expected to file a counter to the charges for lack of a defining beacon on the reef since according to their legal counsel the Port Authority is responsible for maintenance and placement of warning beacons or markers, he said, that they were checking on that and doing their research. Some experts on marine aids said that the passage is an easy one but that to be entirely safe there should be four more markers defining the reef for boaters.

The Thorfinn does not carry pollution or indemnity insurance. It would cost upwards of $20 million to replace the Thorfinn in today's market and if oil spillage causes ecological damage to Pohnpei the cost would be inestimable. It would be insensitive to even try to do so. Legal counsel for Sokehs Municipal Government has already suggested in a letter to parties involved that $1.5 million might be sufficient for damages. Acting Sokehs Chief Magistrate Michael Liemen was not aware of the request. At least one of the lawyers involved has said that Sokehs does not control the reef.

A Pohnpei White Sand vessel sunk inside the Sokehs lagoon some time ago and has, within the last few months begun to leak fuel leaving a telltale sheen on the water there. Liemen said that he was not aware of any legal action having been filed against the owner of PWS by the municipal government.