Bunker Quality Clause

What it does

A bunker quality clause sets the specification that fuel supplied to the vessel must meet and allocates responsibility when bunkers are off-specification. Under a time charter the charterer usually supplies and pays for bunkers, so the clause requires the fuel to conform to a recognised standard and to be suitable for the ship's engines, and it addresses what happens if the bunkers prove defective.

Because off-specification fuel can damage machinery, cause breakdowns, and require de-bunkering, the clause deals with testing, the consequences of non-conforming bunkers, and the resulting liability. It connects to the off-hire and indemnity provisions, since bad bunkers supplied by the charterer can disable the ship and raise questions of who bears the time lost and the cost of putting matters right.

Commercial effect

The clause allocates the significant risk that defective fuel will damage the ship or interrupt her service. Because the charterer typically chooses and supplies the bunkers under a time charter, placing responsibility for quality on the charterer aligns the risk with control, while the owner remains responsible for the engines and their proper operation. The line between the two is where disputes arise.

The consequences can be costly, involving engine damage, repairs, de-bunkering, and lost time, so the clause's treatment of testing and liability is commercially important. It interacts with the off-hire provisions, since a breakdown from bad bunkers raises the question whether the ship is off hire, and with the employment and indemnity provisions covering the charterer's orders and supplies.

Owner's perspective

The owner wants the charterer to bear responsibility for the quality of the bunkers it supplies, so that fuel meeting the agreed specification is provided and the owner is protected if defective bunkers damage the engines or disable the ship. It relies on the clause to keep the risk of bad fuel with the party that chose and supplied it.

The owner also wants clear testing and a clear path to recovery where off-specification bunkers cause damage or delay, including protection against being put off hire for a problem the charterer's fuel caused. It treats the clause as essential machinery protection and negotiates it alongside the off-hire and indemnity provisions so the consequences of bad bunkers fall on the supplying party.

Charterer's perspective

The charterer accepts responsibility for supplying conforming bunkers but wants the specification and testing regime clear and reasonable, and the owner's engine and operational responsibilities preserved, so that it is not blamed for damage caused by how the ship burned or handled the fuel. It wants the boundary between fuel quality and ship operation well defined.

The charterer is conscious that bunker claims can be large, so it manages its bunker procurement and testing to supply on-specification fuel, and it wants the clause to require proper evidence before liability attaches. It negotiates the quality clause together with the off-hire and indemnity provisions so that responsibility tracks genuine fault rather than defaulting onto whichever party is convenient.

Negotiation points

• The fuel specification and standard the bunkers must meet.
• The testing regime and the evidence required to establish off-specification fuel.
• Who bears engine damage, de-bunkering, and lost time from defective bunkers.
• The interaction with the off-hire and employment and indemnity provisions.

Common variations

• A clause requiring bunkers to meet a recognised international fuel standard.
• A clause specifying representative sampling and testing procedures.
• A provision making the charterer liable for damage from off-specification fuel.
• A clause coordinating bunker quality with the off-hire regime.