Four years ago, the “X-Press Pearl”, loaded with nitric acid and plastic pellets, sank off the coast of Sri Lanka.
X-Press Feeders said it is delaying paying the US$1 billion of damages ordered by Sri Lankan courts over the X-Press Pearl disaster, saying that complying with the judgment sets a dangerous precedent for how future maritime incidents will be resolved.
In June 2021, the newly built 2,700 TEU X-Press Pearl sank off Colombo, following an explosion believed to have been caused by leaking nitric acid cargoes. In July, Sri Lankan courts decreed that the Singapore-based company had to pay the massive compensation for ecological damages arising from the incident.
X-Press Feeders disclosed its decision, following consultations with its insurer, London P&I Club, to hold off on paying any part of the compensation the same day the first instalment, amounting to US$250 million, is due. The company also said it wants to be assured the compensation is aligned with international conventions.
In its statement, X-Press Feeders said it has already contributed over US$ 170 million through its insurer, towards wreck removal, environmental remediation and compensation. This has been done in cooperation with the Sri Lankan authorities, with funds specifically earmarked for affected communities, including fishermen. The company said: “The key concern is ensuring that compensation is delivered fairly, transparently, and through a clear process. Without that, this case risks setting a dangerous global precedent — one that could undermine the principle of limit to liability that underpins international shipping, insurance and ultimately consumer trade.”
X-Press Feeders’ management expressed disappointment that the earlier US$170 million payment has not yet reached many affected communities due to delays within Sri Lanka. The feeder operator reiterated its call for the Sri Lankan government to be fair to the X-Press Pearl master, who has been prevented from leaving the country. The company further alleged that its local agents continue to face arrests and court proceedings for an incident which they had no decision-making role in.
X-Press Feeders continued: “We are open to direct dialogue with the relevant Sri Lankan authorities and have been actively seeking to engage with their representatives. We hope to achieve an outcome that is evidence-based, fair, proportionate and consistent with international practice.” (PL)
