JANUARY 10, 2000

CIRCULAR NO. 1/00

TO MEMBERS OF THE ASSOCIATION

Dear Member:

VOYAGE SURCHARGES FOR U.S. TRADING TANKERS: 2000 POLICY YEAR

The current system of charging voyage surcharges for tankers trading to the United States will continue for the next policy year. Happily, however, in light of a continuingly improved record for oil pollution claims over the decade since the EXXON VALDEZ accident, the surcharges for the 2000 policy year show significant reductions.

As is the case at present, a differential will apply as between those vessels which have segregated ballast tanks (SBT) and those which are not so equipped. In order to qualify for the lower rates applicable to the SBT category of tonnage, a vessel must be equipped with segregated ballast tanks as defined by Regulation 13 of Annex 1 to MARPOL 73/78.

Tankers with SBT will attract a surcharge of US $0.075 per gross ton per voyage in 2000, down from US $0.11 in 1999. Non-SBT tankers will pay US $0.085 per gross ton per voyage in 2000, down from US $0.13 in 1999. As is the case in the current year, a 20 voyage "cap" will continue to apply. Equally, the 50% reduction for tankers calling at the Louisiana Offshore Oil Port (LOOP) or other designated lightening areas will continue.

Members may find the following table to be of assistance in setting out the 2000 policy year arrangements.

The footnote below contains the definitions which apply to the terms used on the previous page.

The Managers will be pleased to respond to any questions Members may have in regard to the above, or generally.

Yours faithfully,

Joseph E.M. Hughes, Chairman & CEO
Shipowners Claims Bureau, Inc., Managers for
THE AMERICAN CLUB

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