Compensation may be limited.
The coasts of Mauritius have been devastated by the recent leak from a Japanese owned cargo ship. 1000 tons of oil were released after the MV Wakashio ran aground on a coral reef, and the fuel is still spreading.
The local economy relies heavily on tourism and fishing, so the spill damage compounds problems brought on by COVID 19. 20% of the population was employed by the tourism industry. Blackened beaches are not going to tempt prospective travelers as pandemic restrictions lift.
The spill has also prompted the government to declare a state of environmental emergency. While the volume of oil is relatively small compared to other spills over the decades, the location of the grounded ship makes the damage significant. The MV Wakashio is currently situated between a coral atoll and a marine park. Oil is also leaking close to two internationally protected wetlands and a fishing reserve.
Nagasaki Shipping owns the ship and the Mauritian government is pushing for compensation. However, International Conventions often calculate compensation based on the size of the vessel. Under the Bunkers Convention (2001) compensation could prove to be as low as $18 million dollars.
The countries have ratified different versions of the Limitation of Liability for Maritime Claims (LLMC), and the ship is registered in Panama. This further complicates matters because they do not have any version of the LLMC ratified and might consider applying national limits.
Regrettably, for Mauritius, if the oil had come from a different ship, compensation could be significantly higher. The country is party to the IOPC Fund, an international framework that governs compensation for pollution from oil tankers. Funds are provided by oil companies who receive fuel shipped around the world. If the fuel was emanating from an oil tanker compensation could have been over $250 million.
Since 1978, the IOPC has paid out $983 million from 154 oil spills. However, according to a senior legal officer at the International Maritime Organization 95% of pollution cases are not caused by dedicated oil tankers.
Experts agree the damage cannot be quantified at this time - the disaster is not yet over. It's likely the losses will exceed the applicable limitation amounts.