London marine insurers widen Middle East threat zone after ship attacks

London’s marine insurance market has extended the list of waters deemed high risk to include Oman, the United Arab Emirates and the Gulf after ship attacks off Fujairah. (File/AFP)
Updated 17 May 2019

London marine insurers widen Middle East threat zone after ship attacks

  • The London insurance market’s Joint War Committee said in a statement that the additions cover areas of perceived enhanced risk for marine insurers and reflected enhanced regional risk
  • The Joint War Committee also added adjacent waters around the Gulf of Oman to its high risk list

LONDON: London’s marine insurance market has extended the list of waters deemed high risk to include Oman, the United Arab Emirates and the Gulf after ship attacks off Fujairah, officials said on Friday, in a move that could push up premiums.
The London insurance market’s Joint War Committee said in a statement that the additions cover areas of perceived enhanced risk for marine insurers and reflected enhanced regional risk.
“The situation will be kept under close review,” said the Joint War Committee, whose guidance influences decisions by underwriters on insurance premiums.
Four tankers, comprising Saudi Arabian, UAE and Norwegian-flagged ships, were attacked on Sunday off Fujairah. No one has claimed responsibility for the incident.
The attacks took place against a backdrop of US-Iranian tension following Washington’s decision this month to try to cut Tehran’s oil exports to zero and beef up its military presence in the Gulf in response to what it called Iranian threats.
Iran accuses Washington of stoking tensions and had denied it had any role in the attacks.
The Joint War Committee, made up of syndicate members from the Lloyd’s Market Association (LMA) and representatives from the London insurance company market, normally meets every quarter to review areas it considers high risk for merchant vessels and prone to war, terrorism, piracy and related perils.
The Joint War Committee, which met on Thursday after developments in the Middle East ahead of Friday’s decision, also added adjacent waters around the Gulf of Oman to its high risk list. The last update to the list was in June 2018.
The UAE, Saudi Arabia and Norway have launched an investigation and have described the attacks as deliberate. They have not blamed anyone.
“Very little information is to hand about the explosions at Fujairah anchorage on May 12 and the circumstances and methods employed remain unclear,” the Joint War Committee said in further comments.
“There is no doubt that considerable damage was done and there will be significant claims,” it added.
The London marine insurance market plays an influential role in the global marine insurance industry.
A confidential Norwegian insurers’ report seen by Reuters concluded that Iran’s elite Revolutionary Guards were “highly likely” to have facilitated the attacks on the tankers.
Iran has said the attacks on the tankers were a cause for concern and has called for an investigation.
Iran said on Friday it could “easily” hit US warships in the Gulf, the latest verbal broadside in the spat between Washington and Tehran.


Saudi energy giant to invest $3bn in Bangladesh’s power sector

Updated 22 October 2019

Saudi energy giant to invest $3bn in Bangladesh’s power sector

  • Experts say deal will usher in more economic and development opportunities for the country

DHAKA: Saudi Arabia’s energy giant, ACWA power, will set up an LNG-based 3,600 MW plant in Bangladesh after an agreement was signed in Dhaka on Thursday.

The MoU was signed by ACWA Chairman Mohammed Abunayyan and officials from the Bangladesh Power Development Board (BPDB), officials told Arab News on Monday.

According to the agreement, ACWA will invest $3 billion in Bangladesh’s energy development sector, of which $2.5 billion will be used to build the power plant while the rest will be spent on an LNG terminal to facilitate fuel supply to the plant. Under the deal, ACWA will also set up a 2 MW solar power plant.

In recent months, both countries have engaged in a series of discussions for investment opportunities in Bangladesh’s industry and energy sectors. 

During the Saudi-Bangladesh investment cooperation meeting in March this year, Dhaka proposed a $35 billion investment plan to a high-powered Saudi delegation led by Majed bin Abdullah Al-Qasabi, the Saudi commerce and investment minister, and Mohammed bin Mezyed Al-Tuwaijri, the Saudi economy and planning minister.

However, officials in Dhaka said that this was the first investment deal to be signed between the two countries.

“We have just inked the MoU for building the LNG-based power plant. Now, ACWA will conduct a feasibility study regarding the location of the plant, which is expected to be completed in the next six months,” Khaled Mahmood, chairman of BPDB, told Arab News.

He added that there are several locations in Moheshkhali, Chottogram and the Mongla port area for the proposed power plant.

“We need to find a suitable location where the drift of the river will be suitable for establishing the LNG plant and we need to also consider the suitability of establishing the transmission lines,” Mahmood said.

“It will be either a JV (Joint Venture) or an IPP (Independent Power Producer) mode of investment, which is yet to be determined. But, we are expecting that in next year the investment will start coming here,” Mahmood said.

BPDB expects to complete the set-up process of the power plant within 36 to 42 months.

“We are in close contact with ACWA and focusing on the successful completion of the project within the shortest possible time,” he said.

Abunayyan said that he was optimistic about the new investment deal.

“Bangladesh has been a model for the Muslim world in economic progress. This is our beginning, and our journey and our relationship will last for a long time,” Abunayyan told a gathering after the MoU signing ceremony.

Economists and experts in Bangladesh also welcomed the ACWA investment in the energy development sector.

“This sort of huge and long-term capital investment will create a lot of employment opportunities. On the other hand, it will facilitate other trade negotiations with the Middle Eastern countries, too,” Dr. Nazneen Ahmed, senior research fellow at the Bangladesh Institute of Development Studies (BIDS), told Arab News.

She added that Bangladesh needs to weigh the pros and cons before finalizing such contracts so that the country can earn the “maximum benefits” from the investment.

“It will also expedite other big investments in Bangladesh from different countries,” she said.

Another energy economist, Dr. Asadujjaman, said that Bangladesh needs to exercise caution while conducting the feasibility study for such a huge investment.

“We need to address the environmental aspects, opportunity costs and other economic perspectives while working with this type of big investment. Considering the present situation, the country also needs to focus on producing more solar energy,” Dr. Asadujjaman told Arab News.