STRICKEN: The Shen Neng 1 spent 12 days on Douglas Shoal, about 100km from Gladstone.
STRICKEN: The Shen Neng 1 spent 12 days on Douglas Shoal, about 100km from Gladstone. Alistair Brightman

Shen Neng: Shipping disaster damage to top $120 million

WHEN a 71,000-tonne bulk coal carrier ran aground on the Great Barrier Reef near Gladstone six years ago, it left behind hundreds of kilograms of toxic paint and a 3km scar across 40ha of delicate corals.

The Commonwealth Government told the Federal Court it will cost at least $120 million to "remediate" the damage caused by Chinese ship Shen Neng 1 when it strayed about 10km out of the shipping lanes and hit Douglas Shoal in April 2010.

The stricken carrier spent 12 days on the shoal, about 100km from Gladstone.

As well as leaking four tonnes of oil into the ocean from punctured fuel tanks, the ship left large deposits of rubble, broken rocks, dislodged algal growth and hard-to-remove flakes of the paint.

The paint, a now-banned anti-fouling agent used to decrease drag on the carrier, contained copper, zinc and the toxic chemical tributyltin - also known as TBT.

Opening for the Commonwealth in its damages case against ship owner Shenzen Energy Transport Co, barrister Martin Scott QC told the court removing the TBT was not going to be easy or cheap.

Mr Scott told Justice Andrew Greenwood the chemical could cause irreversible damage to the shoal's marine inhabitants.

"The TBT ... must be taken out of the environment," Mr Scott said.

"Not all of the flakes are sitting on the surface - some are mixed into the sediment.

"They'll just sit idle until they are stirred up, then they will start doing their evil work.

"It requires a significant effort to fix it."

Maritime insurer The London P&I Club, which represents Shenzen Energy, is expected to argue the damage is not as significant as suggested by the government's experts and that the reef has started healing.

It will also argue that the government's delay in fixing the reef after the accident caused more damage to the shoal.

London is also expected to submit to the court that the government's compensation claim is "unrealistic" and should be limited to less than $25 million as regulated by the 27-year-old Commonwealth Limitation of Liability for Maritime Claims Act.

"The Shen Neng 1 incident was the result of an error by the chief officer of the vessel, who was employed by an independent ship management company - not the owners," London said in a media statement released before the start of Tuesday's court hearing.

"... there is evidence that large parts of the shoal are recovering naturally and that going 'all out' with human remediation efforts, such as dredging as proposed by the Commonwealth, would be environmentally counter-productive."

Over the next four weeks, the court will hear from disaster and marine experts as well as the two men who were held criminally responsible for the disaster.

Chief officer Xuegang Wang, who was in charge of the vessel, was sentenced to 18 months in jail in 2012. He served three months and was placed on a two-year good behaviour bond.

Ship master Jichang Weng was fined $25,000.

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