Ship that blocked Suez Canal to be released on Wednesday

Egypt will release the MV Ever Given vessel on Wednesday, which blocked the crucial passage of the Suez Canal in March earlier this year, after the managing authorities of the passage cracked a deal with the owners of the ship.

The vessel was stuck in the narrow waterway for nearly a full week after a sandstorm pivoted its direction while carrying deadweight tonnage of 199,000.  

Japanese company Shoei Kisen Kaisha, which owns the vessel, struck a deal with the Suez Canal management to ensure the “departure of the ship”, Egyptian authorities said. The ship was not allowed to move forward after being dislodged, citing lost revenue from the canal, which is crucial for connecting Asia and Europe.

The statement that was issued on Sunday did not disclose the amount of compensation.

Egypt lost between $12 million and $15 million in revenues for each day the waterway was closed, according to the Suez Canal Authority.

The grounding of the ship and the intensive salvage efforts needed to refloat it also resulted in significant damage to the canal, reported AFP.

A member of the London-based Stann Marine law firm which represents the owners and insurers of the Ever Given confirmed in a statement that preparations were underway for its release.

“We are pleased to announce that… good progress has been made and a formal solution agreed” between the two sides, Faz Peermohamed said in the statement.

Last week, Suez Canal Authority chief Osama Rabie said Egypt had signed a non-disclosure agreement with the owners of the Ever Given as it finalised the compensation agreement.

Initially, Egypt had sought hundreds of millions of dollars in compensation but it later slashed its initial claim of $900 million to $550 million.

The Taiwanese-operated and Panama-flagged ship was moved to unobstructive anchorage in the Suez Canal after it was freed on March 29, and tailbacks totalling 420 vessels at the northern and southern entrances to the canal were cleared in early April.

In April, maritime data company Lloyd’s List said the blockage by the vessel, longer than four football fields, held up an estimated $9.6 billion-worth of cargo between Asia and Europe each day it was stuck, reported AFP.

Egypt’s President Abdel Fattah al-Sisi has ruled out any widening of the southern stretch of the canal where the boat became diagonally stuck.

Sisi oversaw an expansion of a northern section, which included widening an existing stretch and introducing a 35-kilometre (21-mile) parallel waterway, to much fanfare in 2014-15.

But that was achieved at a cost of over $8 billion, without significantly increasing revenues from the canal.

The Suez Canal, which has been in the crosshairs of numerous countries for maintaining strict toll rates, garnered about $5.7 in revenue in the 2019-2020 fiscal year, according to reports from AFP.