AUGUST 15, 2000

CIRCULAR NO. 6/00

TO MEMBERS OF THE ASSOCIATION

Dear Member:

STATE OF ALASKA: CERTIFICATES OF FINANCIAL RESPONSIBILITY IN REGARD TO NON-TANK VESSELS

Please note that with effect from September 1, 2000 owners or operators of non-tank vessels trading in Alaskan waters will be required by statute to establish evidence of financial responsibility for the following limits:

(a) for vessels carrying predominantly persistent products U.S. $300 per incident for each barrel of oil storage capacity, or U.S. $5 million, whichever is the greater; or

(b) for vessels carrying predominantly non-persistent products, U.S. 100 per incident for each barrel of oil storage capacity, or U.S. 1 million, whichever is the greater.

The rules apply to non-tank vessels over 400 gross register tons. Evidence of financial responsibility may be demonstrated by the following:

1. An affidavit of self-insurance supported by the most recent audited financial statement.
2. An insurance certificate and insurance policy;
3. A surety bond;
4. A financial guarantee, accompanied by the guarantor's evidence of self-insurance;
5. A letter of credit;
6. A certificate of entry evidencing coverage by a Protection and Indemnity Club; or
7. A certificate of deposit with assignment of negotiable interest.

Owners and operators who already have existing certificates of financial responsibility for tank vessels or oil barges may amend their current applications to include non-tank vessels.

Members should note that the production of a P&I Club certificate of entry is sufficient evidence of financial responsibility except for evidence of financial responsibility for sums falling within the deductible relevant to the entry.

Application forms can be obtained from the following address:

State of Alaska
Department of Environmental Conservation
Financial Responsibility
Division of Spill Prevention & Response
410 Willoughby Avenue - Suite 105
Juneau, Alaska 99801-1795 U.S.A.
Telephone: +1-907-465-5225
Fax: +1-907-465-5245

They may also be obtained from the web page:
www.state.ak.us/dec/dspar/ipp/frpage.htm

To ensure compliance with the September 1, 2000 deadline, owners or operators of non-tank vessels must submit their application together with supporting documentation to the Alaskan Department of Environmental Conservation no later than August 31, 2000.

Finally, Members should also note that the final regulations concerning the provision of Alaskan Certificates of Financial Responsibility have not yet been published and are unlikely to be published prior to September 1, 2000.

Yours faithfully,

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