Dealing with insurers could help recover oil spill clean-up bill – expert

The government was told that a successful prosecution doesn’t guarantee that the fines imposed would be paid

Dealing with insurers could help recover oil spill clean-up bill – expert

Insurance News

By Mina Martin

A maritime and commercial law expert has stated that a successful prosecution for a 2015 oil spill might still see the Queensland government struggling to recover clean-up costs – unless they deal with the insurance industry.

In July 2015, about 15 tonnes of oil washed up on beaches north of Townsville to Hinchinbrook Island and the Palm Island group, requiring a clean-up effort that took two weeks and cost $1.5 million.

Facing charges for the spill, which allegedly took place at Pakhoi Bank within a designated shipping lane in the Greater Barrier Reef Marine Park, is the ship Regina, owned by Globex Shipping, ABC reported.

Search and compare insurance product listings against Contamination from specialty market providers here

The Panama-based company will appear before the Magistrates Court in August and will face a maximum penalty of $17 million for charges over discharge of oil into the sea, if proven guilty.

Speaking about its worldwide search for the culprit, Queensland Ports minister Mark Bailey said: “If you do the wrong thing and pollute our beaches, and pollute our reef, we will track you down and prosecute you.

“I was outraged... I wanted us to make sure that we’ve made an example of the culprits because nobody reported this. That’s the thing, nobody reported this as a problem, they get away with it - but not in Queensland.”

Professor Nick Gaskell of the University of Queensland told ABC, however, that the Government might find it difficult to recover the fines even if the prosecution was successful.

“The difficulty for a government is in trying to enforce fines abroad because most states would not recognise those fines,” he said.

“If the defendant doesn’t appear then you’ve got a real difficulty in enforcing those fines. Of course, if the ship comes to your shores again then it’s at risk.”

Gaskell said it is possible to recover the clean-up costs by dealing with the insurance industry.


“Most ships would have insurance cover for fines, provided it’s an accidental discharge,” he told ABC. “In many cases, the insurers might want to stand behind the ship owner because the insurer itself may well be directly liable for all the clean-up costs caused by the pollution.”

Keep up with the latest news and events

Join our mailing list, it’s free!