Costamare subsidiary reaches settlement in Rena case

OCTOBER 1, 2012 –The New Zealand Government and Costamare subsidiary Daina Shipping Company (owner of the containership MV Rena) have reached what Maritime New Zealand calls “a comprehensive financial settlement in respect of matters arising from the ship’s grounding on October 5, 2011.”

Keith Manch, Director of Maritime New Zealand, confirmed that Daina Shipping Company will pay NZ$27.6 million (about US $23 million) to settle the claims of the Crown and public bodies including Maritime NZ, Bay of Plenty District Health Board, Environmental Protection Agency, the Minister of Local Government (signing as the territorial authority for Motiti island), and the New Zealand Transport Agency.

“This was a very complex negotiation given the range of issues and parties involved, and represents a good outcome for New Zealanders,” said Mr. Manch.  “As with any settlement it is about finding a solution that both sides can live with, and I would like to acknowledge the constructive approach taken by Daina Shipping Company and their continuing commitment to meet their obligations under New Zealand law.”

The settlement also recognizes that Daina Shipping Company and The Swedish Club (the Rena’s insurers) are currently investigating the environmental, social, cultural and economic impacts of different options for dealing with the wreck.  In the event that they decide to apply for, are granted, and use a resource consent to leave part of the wreck in place, Daina Shipping Company will make an additional payment of NZ$10.4 million(about US$8.6 million) to the Crown, reflecting their reduced salvage costs.

Konstantinos Zacharatos, on behalf of Daina Shipping Company, said: “We have always sought to work closely with the New Zealand authorities to address all aspects of this serious incident.  This settlement is a vital step forward in our progressive resolution of all the issues, and I want to thank the New Zealand authorities for all of their work that has gone into achieving this outcome.”
New ZealandTransport Minister Gerry Brownlee commented: “Under maritime law when the Rena went aground Daina Shipping was only obliged to pay a maximum of approximately NZ $11.3 million (about US$9.3 million) compensation for losses caused by its grounding.”

To date the cost to the Crown of the Rena grounding is approximately NZ$47 million (about US$39 million).

“These agreements allow both New Zealand as a whole, and the Bay of Plenty region, to move on from what was, from an environmental standpoint, the worst maritime disaster in our history,” Mr. Brownlee said. “I am confident Daina Shipping will continue to take a positive approach to all elements of the wreck removal process and their legal obligations.”

A Marine Legislation Bill, currently going through the New Zealand parliamentary process, will substantially increase the amount of compensation payable by shipowners for incidents like the Rena grounding. That legislation is expected to be in place in early 2013.