OFFSHORE marine group Otto Marine said on Wednesday its subsidiaries Swordfish 5 and GO Offshore have each begun arbitration proceedings under the London Maritime Arbitrators Association Terms 2012 against Vettal Mega Services.
This was over two bareboat charterparty contracts.
"Among other things, charterer has failed to pay hire due and owing for an aggregate quantum in the region of US$6 million under the contracts," Otto Marine said. "The company is working closely with its lawyers in connection with the legal proceedings to, inter alia, enforce the subsidiaries' rights under the contracts, and safeguard as well as protect the interests and assets of the group."
It added that this is not expected to have a material impact on the company's financials for the financial year ending Dec 31, 2016.
Just last week, Otto also said it has started arbitration proceedings against Robert Knutzen Shipholdings Ltd (RKSL) for alleged default on charter parties.
RKSL allegedly took delivery of and operated two vessels under Otto Marine's fleet under bareboat charter parties dated Jan 15, 2009.
Otto Marine said RKSL has been in default of the charter parties for a sum of over US$2.8 million plus applicable interest for overdue payment.
Robert Knutzen, a shipping veteran, is the personal guarantor to the charter parties. Otto Marine's appointed lawyers are Rajah & Tann Singapore LLP. It is working with its lawyers to take action, including but not limited to, progressing the arbitrations and enforcing any arbitral awards against Mr Knutzen as the personal guarantor so as to safeguard and protect its interests and assets.