CHRISTIANSTED — Ionian Management Inc., a New York-based company that commercially manages three vessels, including the M/T Ocean Princess, was slapped with a $250,000 environmental fine for polluting the air by burning high-sulfur fuel in and around St. Croix’s waters at least 26 times.
IONIAN M was sentenced yesterday before U.S. District Court Judge Wilma A. Lewis after pleading guilty to a violation of the Act to Prevent Pollution from Ships. IONIAN M was sentenced to pay a fine of $250,000 and placed on probation for one year.
While vessels are operating within the U.S. Caribbean Emissions Control Area (ECA), they must
not use fuel that exceeds 0.10% sulfur by weight to help protect air quality. Between January 3, 2017,
and July 10, 2018, the M/T Ocean Princess entered and operated within the ECA using fuel that
contained excessive sulfur on twenty-six separate occasions.
The fuel was petroleum cargo that had been transferred to the fuel tanks as authorized by IONIAN M. Once authorized, the crew of the M/T Ocean Princess transferred the higher sulfur fuel from the cargo tanks into the bunker tanks and use it to fuel the vessel, even though it exceeded the 0.10% sulfur by weight maximum.
U.S. Coast Guard inspectors boarded the M/T Ocean Princess on July 10, 2018, to conduct an
inspection. During the inspection, the U.S. Coast Guard discovered the vessel’s use of fuel with
an excessive sulfur content.
“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 pristine beauty of our Virgin Island waters is one of our most precious resources, essential
to our tourism and our fragile marine ecosystem,” said First Assistant U.S. Attorney John Kuhn
for the District of the Virgin Islands. “Today’s sentencing of Ionian Management Inc. for its role
in causing high sulfur fuel to be burned within the Caribbean Emissions Control Area, and here in
the waters near St. Croix, sends a strong message to commercial managers of ships that such
conduct will not be tolerated. To protect the territory of the Virgin Islands, we will continue to
pursue criminal enforcement of environmental laws.”
“Ocean going vessels emit hazardous air pollutants or air toxics that are associated with adverse
health effects impacting populations living near ports and coastlines,” said Special Agent in
Charge Tyler Amon of EPA’s Criminal Enforcement Program in the Virgin Islands. “EPA, along
with its law enforcement partners are committed to ensuring the shipping industry continues to
comply with laws designed to protect air quality.”
“The results announced today send a strong message to anyone who seeks to take shortcuts and
intentionally pollute our environment, and I couldn’t be prouder of the Coast Guard’s Resident
Inspection Office in St. Croix and Sector San Juan marine inspectors who first identified the issue,
as well as our Coast Guard Investigative Service agents who worked closely with the
Environmental Protection Agency in San Juan to investigate this case,” 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 M/T Ocean Princess was owned by Lily Shipping Ltd. and operated by Ionian Shipping and
Trading, both Greece-domiciled companies. These 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 $3,000,000, serve a three-year period of probation,
and implement an Environmental Compliance Plan.
The sentencing of Ionian M is the final chapter in this multi-year investigation and prosecution of the companies and individuals involved in the use of non-compliant, high-sulfur fuel in the operation and management of the M/T Ocean Princess.
Three years ago, at least 11 crew members of the oil products tanker M/T Ocean Princess were detained in the territory indefinitely, including a Russian national who has asked to be allowed to return home to Crimea while federal law enforcement agents conducted the criminal investigation into the ship’s operations, according to court documents.
The Chief Officer of the Ocean Princess, Rey Espulgar, has filed an emergency petition in federal court, asking that one of the ship’s crew members, Oleg Dyachuck, be deposed as soon as possible “to preserve the witness’ testimony for use in future administrative, civil, and/or criminal proceedings” the government may pursue against Espulgar, or in a possible civil action Espulgar may file against the U.S. government.
The M/T Ocean Princess is an oil Products Tanker that was built in 2003 (19 years ago) and is sailing under the flag of Marshall Is. It’s carrying capacity is 8016 t DWT and her current draught is reported to be 5.3 meters. Her length overall (LOA) is 113 meters and her width is 18.2 meters.
The Coast Guard Investigative Service and the Environmental Protection Agency-Criminal
Investigation Division conducted the investigation. Senior Trial Attorney Kenneth Nelson of the
Environment and Natural Resource Division, Environmental Crimes Section, and Former
Assistant U.S. Attorney Kim Chisholm and Assistant U.S. Attorney Daniel H. Huston for the
District of the Virgin Islands prosecuted the case.