US Fines Shipping Company for Caribbean Air Pollution Violations

fine for sulfur cap violations
Product tanker's operator was fined for repeated violations of the sulfur cap in the Caribbean (Virgin Islands Port Authority file photo)

Published Nov 4, 2022 2:43 PM by The Maritime Executive

The United States concluded a multi-year investigation and prosecution of shipping companies operating in the Caribbean with the sentencing of New York-based Ionian Management for violations dating back to 2017-2018 of the air pollution statutes. The company was sentenced to pay a fine of $250,000 and placed on probation for one year in U.S. District Court in the Virgin Islands after having after pleading guilty to a violation of the Act to Prevent Pollution from Ships. It was the second case related to violations discovered in 2018 aboard a small product tanker operating in the region.

“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 prosecution stemmed from a July 2018 U.S. Coast Guard inspection of one of the three vessels operated by Ionian Management. During the inspection aboard the M/T Ocean Princess, the U.S. Coast Guard discovered the vessel’s use of fuel with excessive sulfur content. The 8,000 dwt product tanker was owned by Lily Shipping and operated by Ionian Shipping and Trading, both companies headquartered in Greece.

During its investigation, the Coast Guard determined that the Ocean Princess entered and operated within the U.S. Caribbean Emissions Control Area (ECA) on twenty-six separate occasions using fuel that contained excessive sulfur. Under the regulations, vessels operating within the ECA must not use fuel that exceeds 0.10 percent sulfur by weight.

Between January 3, 2017, and July 10, 2018, the Ocean Princess repeatedly violated the standards. According to court papers, the fuel was petroleum cargo that was transferred to the fuel tanks as authorized by Ionian M. Once authorized, the crew of the Ocean Princess transferred the higher sulfur fuel from the cargo tanks into the bunker tanks and used it to fuel the vessel, even though it exceeded the 0.10 percent sulfur by weight maximum.

“The results announced today send a strong message to anyone who seeks to take shortcuts and intentionally pollute our environment,” said Rear Admiral Peter Brown, Commander of the Coast Guard, Seventh District. “We will continue to work with our Department of Justice and environmental protection partners to hold accountable any who put profit above the protection of our waters, beaches, and the air above them for future generations.”

The sentencing of Ionian M this week was the final element in the case involving the use of non-compliant, high-sulfur fuel in the operation and management of the M/T Ocean Princess. In 2019, the same companies previously pleaded guilty to felony violations related to the use of non-compliant fuel and falsification of records. They were each ordered to pay a $1.5 million fine ($3 million total) and were placed on three years of probation. In addition, the court required them to implement an Environmental Compliance Plan.