Suez Canal: Egypt 'seizes' Ever Given ship over failure to pay $1bn compensation

The giant Ever Given container ship that was stuck in the Suez Canal for nearly a week has been “seized” over its failure to pay $900m in compensation, canal authorities said on Tuesday. 

Osama Rabie, the Suez Canal Authority (SCA) chief, said the ship had been seized on court orders until its owners paid for the damages incurred during the blockage.

The 400-metre-long Ever Given grabbed international headlines on 23 March after it was jammed diagonally across a southern section of the canal in high winds, halting traffic on the shortest shipping route between Europe and Asia.

About 15 percent of world shipping traffic transits the Suez Canal, which is an important source of foreign currency revenue for Egypt. 

The mammoth vessel was eventually freed on 29 March, with the SCA claiming that it had lost between $12m and $15m in fees per day of the closure.

In addition, the immobilisation held up an estimated $9.6bn worth of cargo each day, according to maritime data company Lloyd's List.

Egypt’s 'right' to damages

The $900m compensation figure was calculated based on “the losses incurred by the grounded vessel as well as the flotation and maintenance costs, according to a court ruling handed down by the Ismailia Economic Court,” Rabie said. 

Earlier this month, Rabie claimed it was Egypt's “right” to claim compensation, citing the costs of equipment work, damages, and canal workers deployed over a period of six days in order to float the ship.

“This is a state’s right, God willing, we will reach a billion and a little more,” he said. “This is the right of the country, we will not waste a penny.”

Sources told AFP that negotiations over damages were ongoing between the Japanese company Shoei Kisen Kaisha that owns Ever Given, insurance firms and the canal authority. 

Following the blockage, Egyptian President Abdel Fatah el-Sisi promised that his government would invest in equipment to prevent the incident happening again. 

Shipping industry sources have urged Egypt to move quickly to upgrade its technical infrastructure to avoid future disruption. 

"The average size of most vessels has increased exponentially over the last 15 years. The ability to salvage these bigger ships has not," Peter Townsend, a marine insurance industry veteran, told Reuters.