A Tragedy in the Red SeaAlSalam 98

by

Iman Seoudi, Ph.D.Director, KCC

Assistant Professor of Strategy & EntrepreneurshipAUC School of Business

Second Responsible Management Education Research ConferenceInclusive Businesses

AUC, 7-8 September 2015

The Journey

The Journey

• Thursday 2nd February 2006 at 9:00 PM

• From Duba port in Saudi Arabia to Safaga, Egypt

• Carrying 96 crew members, 1320 passengers & 220 cars

• Due to arrive in Safaga at 3:00 AM.

• 230 km – 126 nm

The Journey

• Salam 98 Boccaccio was a roll on – roll off ferry (roro)

• Roros are not very safe because

– Doors right above waterline

– Large open space for transporting cargo/cars

– Free surface effect (tilting if water gets in)

• Salam 98 even less stable due to 2 new passenger decks

A Story of Negligence

Disaster Sets In

• Sparks from A/C catch fire with full car fuel tank

• Car fuel tanks are supposed to be empty before boarding on roros

• Crew member on duty below deck no at his post when fire broke out

• Fire extinguishers were dysfunctional

• Water hoses used in stead; hence free surface effect; hence tilting

Disaster Sets In

• Captain was told fire is out

• First engineer ordered opening of garage doors

• Oxygen fueled the fire which picked up again

• Captain: use water hoses on the left and drain water from garage

• 8 out of 12 drainage pumps were clogged

Too Late

• Ship started tilting to the right more & more

• Passengers all moved left to no avail

• Captain ordered crew to turn vessel 20 degrees to counter this motion

• It was too late

• Al Salam 98 had started its 10 minute descent to the bottom of the red sea

Too Late

• Ship had 10 life boats with capacity 100 people each

• 88 life rafts with capacity 25 people each

• It was too late to lower them

• Passengers would not be able to reach the life boats and rafts from the side if ship had listed 15 degrees

The Salam Tragedy

Moments of Horror

• Survivors tell of awful scenes

• Passengers on left side fell more than 15 meters hitting sections of deck and equipment before falling into water

• Yelling, screams, huge waves and death everywhere

• Boat with more than 50 survivors, some of whom suffocated to death

• All agree: Captain was first in a life boat

A Story of Negligence

• Al Salam was manufactured in 1967 by the Italian company Italcantieri

• launched in 1970 under the name of Boccaccio • Only intended for sailing in domestic Italian waters• In 1991, 2 large passenger decks were added to its

structure• Sold to Al Salam for Maritime Transport in 1999 and re-

named Al Salam 98 Boccaccio • Egyptian company, headquartered in Cairo, owned by

Mamdouh Ismail - former appointed member of parliament, hired by ex-president Mubarak, & member of the board of the Port Authority of the Red Sea

A Story of Negligence

• Lloyd’s List:The ferry was sold because it “did not meet the requirements of the Stockholm Agreement for such vessels operating in European waters” (Maritime Knowledge Center 4)

• Egyptian law: a vessel that was more than 25 years old would not be given license to operate

• Al-Salam 98 Boccaccio was 35 years old

• license was obtained from the Pacific Sunlight Marine Inc. of Panama instead

A Story of NegligenceParliamentary inquiry:

• Life boats were not fit for use

• Telestar, a subsidiary company, serviced the boats

• Telestar, owned by a relative of MamdouhIsmail, had an expired license

• Pride of Al Salam had also sunk in as a result of a collision, killing 11 and injuring 98 in 2005

A Story of Negligence

AT SAFAGA PORT

• Al Salam scheduled to arrive at 3AM

• No attempts from port to contact vessel when late

• No distress signals from vessel until moments before going down

• The RAF (Royal Airforce) rescue operations room in Kinloss Scotland picked up Mayday signal & relayed it to Egyptian authorities through France

• Al Salam Maritime Transport did not alert the port authorities until 6AM; a full 3 hours after the ferry sunk

A Story of NegligenceBelated Rescue Operation:

• Saint Catherine, another ship belonging to AlSalamMaritime Transport fleet sailed by at 6:57 AM

• Salah Gomaa, captain of Saint Catherine was aware the ferry established radio contact with 3rd lieutenant

• Lieutenant reported from life boat about disaster

• Salah Gomaa relayed the info to company headquarters and Duba port

• AND CONTINUED HIS JOURNEY……….!!!

Failure of Leadership• Amr Mamdouh Ismail calls Port authority and

reports the vessel missing (Not Sunk!!!)

• This delayed rescue operation even more

• Helicopter flew over scene 9 AM and dropped life rafts and life buoys

• Helicopter went back to report to port and launch rescue operation

• Rescue boats arrived 10 full hours after sinking although wreckage 80km from Egyptian shore

The Journey’s End

The Journey’s End

The Journey’s End

• Survivors floated 10-18 hours without food or water in shark infested waters

• Many died of exposure

• Out of 1516 passengers and crew:

– 387 survivors

– 135 dead bodies pulled from water

– 994 missing (surely dead!)

Chaos & Police Brutality at the Port

• Families of passengers waited hours in Safagaport and were told nothing

• After starting protests, riot police was called in

• Families started throwing rocks at riot police injuring 11 policemen

• Tear gas was fired at families

• Red Crescent tried to help families by providing blankets, food and drink

The Escape

• Mamdouh Ismail, his son, and one other executive from the company fled to London, England

• He paid EGP 300,000 to families of deceased and

• After a 2 year trial, all parties were exonerated except Salah Gomaa, who was fined EGP 10,000 for lacking compassion

• The court decision was based on documents presented to court that the ship was free of defects and had valid licences

Court’s Initial Ruling

Through Egyptian Courts

• The case was appealed on allegations of corruption and forged documentation, as Mamdouh Ismail was well connected to the Mubarak family

• March 2009, a higher Appeals Court of Safagasentenced Mamdouh Ismail to 7 years of prison (max. 10 yrs for manslaughter) for negligence

• Two top executives in company were sentenced to 3 years imprisonment

Rewarding the Negligent

A Commentator:

• The company was to receive million in insurance compensation for the sunken vessel

• It paid compensation for the deceased victims, survivors and car owners, that is a fraction of the compensation considered fair by international law standards .

• That may leave the company with a few million dollars as a reward for its negligence!

What is responsible business?

What is inclusive business?