SLICK STOPPER. An improvised oil spill boom is deployed around a mangrove area in barangay Bangbang in Cordova, Cebu in this file photo. (CDN FILE PHOTO)
Mayor Sitoy gives 2GO, Span Asia and Pioneer Insurance 30 days to pay up or else town goes to court.
Is there insurance money for Cordova fishermen and vendors?
The municipality of Cordova is demanding compensation in the amount of P126.8 million for damage caused by an oil spill to local fishermen, vendors and the coastal environment after a passenger ship sank in the vicinity of the town of Cordova and Talisay City following its collision with a cargo vessel last August.
The demand letter signed by Cordova Mayor Adelino Sitoy, a copy of which was obtained by Cebu Daily News, was sent to corporate heads of 2GO Group Inc. and Philippine Span Asia Carrier Corp. , as well as the Pioneer Insurance and Surety Corp. which extended marine insurance coverage for the vessels.
2GO is the registered owner of the MV St. Thomas Aquinas which capsized at the Lauis Ledge off Talisay City while P
owns the MV Sulpicio Express Siete which collided with the ferry.
A total of 116 of the ferry’s passengers and crew perished in the incident while 21 are still unaccounted for. The St. Thomas Aquinas was en route to the port of Cebu when it collided with the Sulpicio Express Siete which was leaving Cebu for Davao.
The St. Thomas Aquinas, which was carrying 120,000 liters of bunker fuel as well as 40,000 liters of diesel and lubricants, sank causing a massive spill that damaged hundreds of hectares of mangroves in the coasts of Lapu-Lapu City and Cordova. The spill also reached the coast of Talisay City.
Sitoy, former dean of the University of Cebu College of Law, signed the demand letter dated Feb. 11 giving the three companies 30 days to comply or else the municipal government will
resort to “legal remedies” — either court action, administrative sanctions or both.
The demand letters were addressed to Francis C. Chua, chairman of the board of 2GO Group Inc. based in Manila; Enrique Go, chairman of the board of Philippine Span Asia Carrier
Corp. based in the North Reclamation Area in Cebu City; and the management of Pioneer Insurance based in Cebu City.
The money claim of Cordova seeks to tap marine insurance proceeds from the indemnity coverage collectible from Pioneer Insurance.
Earlier in October 2013 , the Department of Environment and Natural Resources (DENR) in Central Visayas sent separate demand letters to both shipping companies assessing them
P41,704,600 in “environmental damage compensation” for ruined mangroves in Cordova that had been planted as part of DENR-funded projects.
This P41.7 million demand was added by Mayor Sitoy on top of his own list of of three affected local groups – fisherfolk, vendors and livelihood projects of people’s organizations.
The biggest damage arose from lost daily income of fisherfolk in 13 barangays at P350 a day for 60 days, he said. This totaled P78,645,000.
The mayor also listed lost income of vendors in five barangays at P350 a day for a total of P5,124,000.
Four people’s organizations (PO) whose livelihood projects incurred damage in the amount of P1,381,622.83.
The Cordova municipal council authorized the mayor to file a claim on behalf of the town in a resolution passed last Feb. 10.
The oil spill “deprived” fishermen of their livelihood, said Mayor Sitoy, and “crippled” their day-to-day trading of marine products of which a good number of Cordovanhons depend on for their daily needs.
He said this caused tremendous damage on coastal mangroves that were “centuries-old” or newly-planted.
The DENR demand letter detailing the mangrove destruction was included as evidence.
DENR Regional Executive Director Dr. Isabello Montejo, in his Oct. 1, 2013 demand letter, said an inventory of the affected area showed that 328 hectares of newly-planted mangroves contracted by nine POs in Cordova and one PO in Lapu-Lapu City were “severely destroyed” while about 115 hectares of natural stand mangroves were also “ruined”.
Montejo said the 328 hectares of mangrove plantains were funded by a DENR program funded by the Asian Development Bank with a total cost of P5,935,000.
Mangroves less than one meter tall died from suffocation due the supply of carbon dioxide which is needed by plants for photosynthesis being cut off, and “too much heat” upon contact with the oil slick.
A hectare of mangroves destroyed means that 1.08 tons of fish per year will be lost, said the DENR.
The DENR, citing a special law, said “when an accident involving two or more ships occurs and pollution damage results, the owners of all the ships concerned, unless exonerated… shall be jointly and severally liable for all such damage.”
The basis was chapter 2, section 6 (f) “Liability on pollution damage” of Republic Act No. 9483.
The law passed in 2007 implements two 1992 International Conventions on civil liability for oil pollution damage and the establishment of an international fund for oil pollution damage.