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Wrecked ship's owners settle New Zealand claims

WELLINGTON, Oct 2 (Reuters) - The owners of a ship which smashed into a reef off a popular New Zealand holiday spot causing the country's worst environmental disaster in decades have reached a multi-million dollar settlement with authorities, the government said on Tuesday.

Daina Shipping, a unit of Greece's Costamare Inc. , will contribute NZ$27.6 million ($22.8 million) to the government's costs over the grounding of the company's 47,230-tonne Liberian-flagged Rena on a reef a year ago.

"We now have agreements that avoid costly and time-consuming court action with no guarantee of the outcome," said Transport Minister Gerry Brownlee.

New Zealand authorities have spent about NZ$47 million in the clean up, but the ship's owners were only immediately liable to pay NZ$11.3 million under existing legislation.

The 236-metre (775-foot) vessel struck a reef about 20 km (12 miles) off Tauranga, New Zealand's biggest export port, in October last year, spewing around 300 tonnes of toxic fuel oil into the ocean, killing thousands of sea birds and fouling beaches up to 100 km (60 miles) from the reef.

The ship's captain and navigation officer, both Filipino nationals, were jailed for seven months in May for operating the ship in a dangerous manner, releasing toxic substances, and altering the ship's documents.

The pair admitted to taking short cuts to ensure the ship did not arrive late at Tauranga.

The ship has broken in half. The rear section has fallen off the reef and salvage operators have been cutting up the bow section, which is still aground.

Under the agreement, the Rena's owners will pay another NZ$10.4 million if they apply for and are granted permission to leave part of the wreck in place.

"This settlement is a vital step forward in our progressive resolution of all the issues," said Daina Shipping spokesman Konstantinos Zacharatos in a statement.

The settlement does not affect court charges laid against the ship's owners for the discharge of harmful substances, which carries a maximum fine of NZ$600,000 ($451,000), and an additional fine of NZ$10,000 for each day the offending continues.

($1=NZ$1.21)

(Reporting by Gyles Beckford; Editing by Richard Pullin)

((Gyles.Beckford@thomsonreuters.com)(+64 4 802 7977)(Reuters Messaging: gyles.beckford.reuters.com@reuters.net))

Keywords: NEWZEALAND SHIP/COMPENSATION