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Ship Manager Sentenced for High Sulphur Fuel Use in Caribbean Emissions Control Area

Mike Schuler
Total Views: 2243
November 4, 2022

A New York-based commercial ship manager has been sentenced to pay a $250,000 fine and serve probation after pleading guilty to using high sulphur fuel in the U.S. Caribbean Emissions Control Area (ECA).

The sentencing closes the book on a multi-year investigation that has resulted in fines now topping $3 million and convictions for three of the ship’s senior officers who carried out and then tried to cover up the transfers.

Ionian Management Inc. (IONIAN M) commercially managed the M/T Ocean Princess, which was found to have entered and operated within the Caribbean ECA using fuel that contained excessive sulfur on 26 separated occasions between January 2017 and July 2018.

In order to protect air quality, vessels operating within Emissions Control Areas are required to use fuel that does not exceed 0.10% sulfur by weight.

An investigation revealed that the fuel used by the M/T Ocean Princess was a petroleum cargo that had been transferred to the fuel tanks under the authorization of IONIAN M. Once authorized, the crew of the tanker transferred the higher sulfur fuel from the cargo tanks into the ship’s bunker fuel tanks, even though it exceeded the 0.10% sulfur limit.

U.S. Coast Guard inspectors boarded the vessel for an inspection on July 10, 2018, at which point they discovered the vessel’s use of fuel with an excessive sulfur content.

The chief officer and chief engineer were caught falsifying the ship’s oil record book by failing to record that cargo had been transferred to the bunker tanks. One also instructed the lower-ranking crew members to lie to the U.S. Coast Guard inspectors about source of the fuel.

IONIAN M was sentenced earlier this week in St. Croix before U.S. District Court Judge Wilma A. Lewis after pleading guilty to a violation of the Act to Prevent Pollution from Ships. The company was sentenced to pay a fine of $250,000 and placed on probation for one year.

“The sentence imposed on this commercial vessel manager for intentionally violating environmental laws designed to protect the air quality of the United States sends a strong message that the United States will not tolerate such violations and will hold violators accountable,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division.

The M/T Ocean Princess was owned by Lily Shipping Ltd. and operated by Ionian Shipping and Trading, both Greece-domiciled companies. The two companies previously pleaded guilty to felony violations related to the use of non-compliant fuel and falsification of records and were sentenced to pay a combined criminal fine of $3 million, serve a three-year period of probation, and implement an Environmental Compliance Plan.

Three senior officers, including the master, chief officer and chief engineer, were convicted and sentenced to three years probation and ordered not to return to the U.S. The Chief Officer was also fined $3,000 for falsifying the ship’s oil record book.

One DOJ officials said the sentencing of Ionian M is the “final chapter” in the multi-year investigation and prosecution of the companies and individuals involved in the case.

“The results announced today are the culmination of four years’ worth of unyielding effort to hold accountable those who knowingly violate our federal laws,” said Rear Adm. Brendan C. McPherson, commander of the Seventh Coast Guard District. “I am exceptionally proud of the dedicated work by our Coast Guard Resident Inspection Office in St. Croix, our Coast Guard Sector San Juan marine inspectors who identified the violation, and our Coast Guard Investigative Service agents who worked with the Environmental Protection Agency in San Juan to investigate this case. Our cooperative efforts with the Department of Justice and environmental protection partners will continue to hold accountable anyone who prioritizes profit over policies designed to safeguard our maritime environment for future generations.”

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