Rena owner settles with Govt

By Hayden Donnell, APNZ staff

Photo / supplied
Photo / supplied

Transport Minister Gerry Brownlee has hailed a compensation deal with the owners of the Rena a success, despite it falling up to $20 million short of the taxpayer bill for the ship's grounding.

Daina Shipping Company will pay $27.6 million to settle the claims of the Crown and several public bodies - including Maritime New Zealand - over the grounding at Astrolabe Reef on October 5 last year.

That could rise to $38 million if the company gains resource consent to leave part of the wreck of the Rena in place at the reef.

The Crown has paid about $47 million so far for the Rena salvage and clean-up operation.

Mr Brownlee said he was satisfied the deal with Daina Shipping Company was the best possible outcome.

Under Maritime Law, Daina Shipping was only obliged to pay a maximum of approximately $11.3 million compensation for losses caused by its grounding, he said.

"Throughout this process Daina Shipping has negotiated constructively, and as a result we now have agreements that avoid costly and time-consuming court action with no guarantee of the outcome...

"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."

A Maritime New Zealand spokesman confirmed the settlement would not affect the Crown's prosecution of Daina Shipping under the Resource Management Act.

The company has been charged with discharging harmful substances from a ship into the coastal marine area and the case is due back in Tauranga District Court later this month.

Maritime New Zealand spokesman Steve Rendle said the RMA charges were still in place and were completely separate from court action.

Meanwhile, Tauranga MP and Associate Transport Minister Simon Bridges has described the settlement as a "strong package for Tauranga, the Bay of Plenty and all New Zealanders".

"While the best possible result for the people of Tauranga would have been for this not to have happened, it did and, given that, this compensation is a strong resolution in the circumstances," he said.

"Locals have been waiting to learn about the compensation and so to an extent its announcement will continue to help people move on from this tragedy."

Maritime New Zealand director Keith Manch said the negotiations over the payment were complex and the result was a "good outcome" for New Zealanders.

"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."

Daina Shipping Company and insurers were still investigating how to deal with the wreck of the Rena.

If part of the wreck is eventually left in place at the reef, the company will make an additional $10.4 million payment to the Crown, Maritime New Zealand said.

Company director and spokesman Konstantinos Zacharatos said the settlement was a "vital step forward".

"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."

The Rena's owners have also agreed to establish a $27 million compensation fund for those who lost goods when the ship ran aground.

Another $11.5 million fund is offering compensation to Bay of Plenty people and businesses who suffered losses.

Tauranga mayor Stuart Crosby welcomed news of today's settlement.

"I'm relieved that it's been settled and that it's not going to go to a very long and costly court process.''

The settlement amount was reasonable considering the situation the Government found itself in with insurance.

"Fair would be full compensation but clearly that's not possible so I think the Crown has done a good job.

"Whether the Rena should stay there will create considerable debate in the community.''

Mr Crosby had been assured there would be community consultation before resource consent was sought.

"My first preference is that it should be removed totally. If it's not practicable, and it might not be, then whatever is left should be made physically and environmentally safe.

"It's just another step in the very long saga of the Rena.''

Charter Fisherman Garth Lelivre said the disaster had cost many local residents dearly in volunteered time to clean up the mess on beaches.

All local businesses were affected to a degree but for him it was just a major inconvenience.

"I thought they were paying for it, I didn't realise we were. I thought that's what insurance was for.''

"I thought they would have to pay the lot themselves.''

The Green Party said taxpayers had to foot the bill for the shortfall because the Government had failed to raise the industry oil pollution levy used to pay for incidents such as the Rena.

Oceans spokesman Gareth Hughes said that a decade ago, the oil pollution fund had about $12 million in it but it was drawn down to $4 million before the Rena disaster.

"The Government has proposed a levy increase to cover operational costs, but that won't build up the oil pollution fund reserves which are used for clean-up costs of spills like the Rena,'' he said.

That essentially meant the Government was willing to use the taxpayer as the insurer for the cost of oil spills rather than industry.

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