Confusion over the status of standby letters of credit (L/Cs) is complicating Trinidad and Tobago's efforts to strengthen its so-called sea bridge, the vessels that ferry passengers and goods between the two islands.

The Port Authority of Trinidad and Tobago (PATT) was expecting the Ocean Flower 2 operated by Bridgemans Services Group LP to begin operations earlier this year but that contract was cancelled in August due to late delivery.

L/C not cancelled

A standby L/C attached to the Bridgemans' contract, which contemplated a daily lease cost of US$26,500, was not however cancelled.

The Ocean Flower 2 contract was cancelled on August 8 after it failed to meet three deadlines (July 17, 26 and August 1) for arrival in Trinidad and Tobago.

Exit clause

The cancellation was in keeping with the exit clause of the contract that dealt with late arrival, which Bridgemans said was due to catastrophic engine failure as well as losing a bearing and a piston on its journey from Korea to the Caribbean. The vessel berthed en route in Panama for repairs.

Bridgemans has confirmed the company was in possession of an irrevocable standby L/C in the amount of US$3 million which is contained in the Charter Party Agreement with the PATT. The company has not said why the L/C was not cancelled or whether the port authority was bound to accept the Ocean Flower 2.

New tenders

After the August contract cancellation, new tenders were issued and six firms bid for the contract, which has not yet been awarded.

One of the bidders is Bridgemans, again offering Ocean Flower 2 to Trinidad and Tobago, which has now been delivered fully certified and ready for service.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.