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Mobil and CUC’s $3.4M wharfage fee remains unsettled
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Posted on Mar 15 2006
The Commonwealth Ports Authority has failed to collect $3.4 million in retroactive wharfage fees that was originally billed to Mobil Oil Marianas, covering a seven-year period from Oct. 1997 to June 2004.
The CPA had sent Mobil a total billing of $6.6 million for the period but Mobil only paid $2.7 million as of October last year, arguing that the rest of the debt had to be paid by the utility firm.
Mobil has been the exclusive supplier of oil to CUC.
Mobil, which had signed a settlement agreement with CPA last year, had demanded payment from CUC but failed to get it.
The right to pursue the debt is now assigned to CPA as provided for in the settlement agreement.
On Feb. 1, 2006, CPA legal counsel Douglas F. Cushnie had sent CUC a demand letter, warning that if no payment is received after 15 days, “a suit will be filed to collect this amount.”
CPA executive director Lee Cabrera said yesterday that CUC has not paid the amount.
The utility firm earlier said that it could not afford to pay the wharfage fee in view of its current financial condition.
CUC had also expressed intent to question Mobil’s assertion that retroactive charges were collectible from CUC under its previous and current contracts with the oil firm.
Mobil’s unbilled wharfage fees to CPA was discovered only in 2004. This amount includes charges from the Port of Saipan and the West Tinian Harbor, where Mobil maintains fuel facilities.
CPA charges a wharfage fee of $5.50 per revenue ton of goods passing through its ports.
Meantime, the $2.7 million paid by Mobil included $718,775.03 in retroactive charges that Mobil asserts is due Shell Marianas as a result of fuel products it brought into the Commonwealth for Shell.
“Mobil has paid…for fuel items brought under its own manifest but for Shell’s account,” said CPA.
