303
1 CHARTERPARTYAGREEMENT
The terms under which vessels are chartered are
containedintheCharterPartyAgreement.Thesetend
tohaveasimilarformatregardlessofwhohasdrafted
them and they contain similar provisions. This
includes information on bunkers, charterers’ rights
and obligations covering speed and performance
warranted by the owner and the Charterer’ rights
shouldtheynotbemet.AssuchCharterersgenerally
pa
y for the fuel consumed over the voyage and the
CharterPartyAgreementsincommonusagescontain
clauses warranting vessel performance in terms of
fuel consumption and speed. Clearly both Speed
MadeGoodandfuel consumedaredependentonthe
weathercondit
ionsexperienced,inparticularcurrents
andwaves.ThereforetheCharterPartyAgreements
also contain definitions of ‘Good Weather Periods’
under which the performance and speed will be
achieved. Usually this is achieved by placing upper
limitsonwinds,wavesandadversecurrents.Ifthe
condit
ions experienced exceedthese, thenthevessel
does not have to perform as per the Charter Party.
However, the performance description applied for
“good weather” and how/when currents should be
taken into account is not always made clear.
Furthermore speed and performance provisions are
notnormallyconsolidatedinoneclauseorcontractual
document,andcanbepoorlyconstructed,leadingto
the potentia
l for costly disputes over speed and
performancewarranty.
2 METHODOFCALCULATION
The Performance Evaluation method is based on a
Good Weather Analysis, a methodology for speed
A Consultative Approach to Charter Party Agreements
Based on Virtual On Time Arrival
H.Davies
PerMarePerTerras(PMPT)Limited,Newtown,UnitedKingdom
S.Bevan
OceanplusLimited,Newtown,UnitedKingdom
ABSTRACT:CharterParty agreements underpin the relationshipbetweenshipowners and charterers.The
agreementguaranteestheperformanceofavesselintermsofspeedandfuelconsumption.Onthisbasisthe
charterersplanthearrivaloftheircargoandtheirprofitmargin.However,shipperformanceisdegradedby
age,periodsbetweenmaintenanceandma
nyvesselsfailtoperformasexpected.Moreovertheperformanceis
onlywarranted during thespecific conditions stated in the charter party which are not always clear. These
usuallyrefertoBeaufortForce(BF)andtheDouglasSeaandSwell(DSS)scalewhichisarchaicintheageof
NumericalWeatherPrediction.Gi
ventheseconditions,thestageissetforconflictandthereareoftendisputes
overtheweatherconditionsexperienced.Moreoverships’oftendonotarriveontimebecausethechartererhas
assumed that the ship will make good its warranted speed and not ta
ken account of the forecast weather
conditions. The authors propose a new way of approaching charter agreements with the emphasis on
consultationratherthanconfrontationfacilitatedbyanewwebbasedsoftwareplatform.
http://www.transnav.eu
the International Journal
on Marine Navigation
and Safety of Sea Transportation
Volume 11
Number 2
June 2017
DOI:10.12716/1001.11.02.13
304
andbunkeranalysiscalculationsingoodweather,as
setoutinthreeEnglishLawprecedentsTheDidymi
Case[1](LloydsReport108,1988),TheGasEnterprise
Case [2] (Lloyds Report 352, 1993) and The Gaz
Energy Case [3] (English Commercial Court: 2011
High Court of England and Wales 3108
and 2012
High Court of England and Wales 1686). The
performanceofa vessel is assessed ingoodweather
period only in order to determine the good weather
performance speed, or her speed capability in good
weather.Thereafter the good weather performance
speedisappliedontheentirevoyage,as
ifthevessel
has performed the entire voyage in good weather
conditions,theunderpinningassumptionbeingthatif
the vessel did not perform to the Charter Party in
good weather then she would not have done so in
worseconditions.
Thekeytothiscalculationisthereforetoestablish
the good
weather periods. These are usually
determinedbyaweatherserviceprovider,appointed
by the charterer and specified in the Charter Party
Agreement.Thegoodweatherperiodsareidentified
afterthevoyagebyreconstructionoftheship’strack
from the noon day reports and/or by AIS reports.
The ship positions are
then matched to the gridded
output from Numerical Weather Prediction (NWP)
modelsandthecorrespondingvaluesforwind,waves
andcurrentextracted.Thegoodweatherperiodsare
identifiedandspeedandconsumptioncalculated.If
theperformanceachievedingoodweatherislessthan
that specified in the Charter Party, then the
good
weatherspeedandconsumptionisextrapolatedtothe
entire voyage to calculate the additional bunkers
consumed and the additional time taken for the
voyage.
Theweatherreportedbythevesselplaysnorolein
thisprocess.Itisthereforenotunusualfordisputes
todevelopregardingtheweatherconditions
reported
by the vessel as compared to those assessed by the
weatherserviceprovider.
Thecurrenttransactionalapproachtocharterssets
upaconflictsituationinwhich:
1 Ship owners cast the vessel consumption and
performanceinthemostfavourablelightinorder
towinbusiness.
2 Masters are under pressure
to perform and
incentivisedto exaggeratethe weather conditions
experienced; this can be exacerbated by poor
qualityreportingoftheactualweatherandpoorly
calibratedweatherinstruments.
3 Chartererscannotrelyonthevesseltodeliverthe
cargototimeandcost.
The authors will propose analternative
collaborativeapproach
toshipcharters,butfirstitis
worth exploring the inherent problems with the
currentapproach.
3 GOODWEATHERDEFINITION
Typicallygoodweatherisdefinedas“uptoBeaufort
Force4andDouglasSeaState3…noadverseeffectsof
Swell/Currents”.
Theobviousproblemwiththisdefinitionisthatit
isvery
unusualfortheseconditionstobemetonan
ocean voyage.Figure 1 shows the probability of
windsin excess of BeaufortForce4occurringinthe
North Atlantic during themonth of August. During
thewintermonthsBeaufortForce4isexceedednearly
100%ofthetimeacrosshuge
swathsofoceannorthof
35N.Itisunrealisticforchartererstoexpectvessels
to make an ‘on time arrival’ without excessive
consumption.Itisperhapsnotwidelyunderstoodby
shore based staff that despite their size that ships
cannotovercomethelawsofphysics.
Fuel consumption is a function of
the resistance
thatthevesselhastoovercome.Inturnresistanceisa
function of the vessel block coefficient, loading, and
trim, water density, currents, waves, winds and
biofouling.
Figure1. North Atlantic‐Probability of wind speed
exceedingBeaufortForce4inAugust(SourceCOADS)
Speed is a function of power and drive train
efficiency and is impacted by engine racing,
slammingandpropellerracingwhichareaffectedby
relativewavedirectionandmagnitude.Theimpact
ofspeedmadegoodcanbeconsiderableasshownin
Figure2.
Figure2.SpeedMadeGoodbyaTankermakingrevolutions
for12knotsforHead,Beam,Followingseas(Source:NIMA
PubNo92009)
4 DOUGLASSEASCALE(DSS)
The DSS is a twodigit scale (proposed by Captain
Douglas, Hydrographer to the Royal Navy in the
1920s)forreportingtheheightofwavesasobserved
at sea. It allows for the distinction between the sea
305
and swell.While the generating wind blows, the
resultingwavesarereferredtoas‘sea’or‘seastate’.
When the winds stops or changes direction, waves
that continue on without relation to local winds are
called‘swell’.TheWMOgivethesedefinitionsas:
Windwaveorwindsea:
Wavesraisedbythewind
blowing in the immediate neighbourhood of an
observationsiteatthetimeofobservation.
Swell:Anysystemofwaterwaveswhichhasleft
its generating area (or observed when the wind
fieldthatgeneratedthewavesnolongerexists).
Waves are generated at a
broad spectrum of
frequenciesandseadoesnothaveaperiodassociated
withitonlyaheight.Incontrast,swelliscomposedof
gravity waves that have been generated elsewhere
and have propagated.Gravity waves experience
frequency dispersion, i.e. waves of different
frequencies travel at different speeds and swell
becomessorted
intowavesofdifferentfrequenciesas
it propagates away from the generating area, with
longperiodswellsarrivingfirst.
Theremaybeaheavy swellpresenteventhough
thewindsarelight.TheDSSwascreatedspecifically
to address this by treating sea and swell separately.
Bydefinitionswellis
notrelatedtothelocalwindand
itisthereforequiteincorrecttolinktheDouglas Sea
Scale Sea State 3 with the Douglas Sea Scale swell
description.
The Douglas Sea and Swell scale has 2
components:‘sea’and‘swell’whichbydefinitionare
independent variables. The Douglas Sea Scale is
reported as 2 numbers; the first referring to the
DouglasSeaState;andthesecondreportingtheswell.
ForexampleiftheDouglasSeaStateheightis1.25m
and the swell is described as short and heavy, then
the Douglas Sea Scale is 36. The WMO has adopted
theDouglas
SeaScale[4]forthereportingofseastate
bymarinersandrecommendsthattheterminologyis
usedin forecasts for shipping[5]. Unfortunately this
format is rarely used and typically only Sea State is
provided.
Douglas Sea Scale 3, as commonly referred to in
Charter Party Agreements, only refers to
the wind
generatedwaveheightandfrequentlyomitstheswell
component.Thelackofaquantifiedvalueforswell
then makes comparison with NWP problematic and
createsproblems for chartercompanieswho wishto
query warranty performance.NWP wave models
are spectral models which work by calculating the
total level
of wave energy in the ocean and then
assigningittoatwodimensionalfrequencydirection
domain(termedthewavespectrum)usedtodescribe
the average motion of the seasurface under waves.
Essentiallythespectrumdecomposesagivenseastate
into a set of constituent sine waves, each with a
differentdirection,period(inverseoffrequency)and
amplitude(energy).Someofthesearedesignatedas
‘swell waves’ whilst others are designated as ‘wind
waves’.
There is one output parameter that combines sea
and swell that can be meaningfully compared to
observed wave heights. This is the Significant Wave
Height which
is a measure of combined ‘sea’ and
‘swell’andisdefinedasfourtimesthesquarerootof
thefirstmomentofthewavespectrum;thisiscloseto
the average height of the highest 1/3 of the waves
(andhasitsoriginsinMunk &Sverdrup1947[6])and
is
what shipborne observers are expected to report.
Measurements of Significant Wave Height are the
mainsourceofdataforwavemodelsandarederived
from remote sensing using space borne Synthetic
ApertureRadar(SAR)andaltimeters.Measurements
of Significant Wave Height from buoys are also
assimilatedandprovidegroundtruth.
Significant Wave Height therefore represents a
‘commoncurrency’ between observations and NWP.
Weather service providers commonly apply a
SignificantWaveHeightof2.0metresasequivalentto
aCharterPartyentryofDSS3.Howevertherehasnot
yetbeenadefinitiverulingonthisinArbitrationand
theuseof
DSSinCharter Partiescontinueswith the
swellpartomittedinmanycases.
Setting aside issues around height, the period of
theswellcanalsohaveabearingontheseakeepingof
the vessel and hence impact performance if
successive waves strike the side of a vessel at the
samephaseofsuccessiverolls,relativelysmallwaves
can cause heavy rolling [7]. The IMO has published
algorithms and guidance for Masters for avoiding
dangeroussituations[8]whichcanreadilybeapplied
topredicttheimpactofswellonseakeepingandship
safety (covering reduction of intact stability,
synchronousrollingand
parametricroll,etc.).
5 ACCURACYOFNWP
Theanalysisandforecastsofsurfacewindaremature
andhavea high degree of reliability.For example,
Figure 3 verifies forecast windspeed against
windspeedobservedatmannedobservingstationsin
Europe where the observations are reliable.It
indicates a forecast accuracy of
+/‐ 1 knot at T+72
hours i.e. 3 days.Similarly the most skillful wave
analyseswhencomparedtobuoysareaccurateto+/‐
0.3metre.
Figure3:RMSErrorofECMWFforecastsof10mwindspeed
atT+48and72(Source:ECMWF)
NWPanalysesarebasedonobservationsandare
themostaccurate depiction of the conditions at that
time.Windanalysesarereadilyavailableat6hourly
intervals at 0000/0600/1200/1800UTC and waves at
0000/1200UTCdaily.Eachmodelcreates‘snapshots
ofreality’as3hourlyforecastsfromtheanalysisbase
time. NWP
models therefore have a temporal
granularityof3hoursandiftheshippositionreport