Marine Log

July 21, 2006

OSG indicted by Texas grand jury

Matthew D. Orwig, U.S. Attorney for the Eastern District of Texas, and Assistant Attorney General Sue Ellen Wooldridge, of the U.S. Department of Justice's Environment and Natural Resources Division, say that a Superceding Indictment has been returned by a federal grand jury in Beaumont, Texas, charging the owner and operator of the M/T Pacific Ruby in a pending case against the ship's Chief Engineer.

In the Superceding Indictment, which was returned July 19, OVERSEAS SHIPHOLDING GROUP, INC.,(OSG) a company that owned and operated the M/T Pacific Ruby through its subsidiaries, was charged as a co-defendant with Chief Engineer Kun Yun Jho, a Korean national, who was first charged on May 17, 2006.

The defendants are charged with conspiracy, making false statements and violating the Act to Prevent Pollution from Ships for their alleged role in maintaining false Oil Record Books that concealed deliberate discharges of oil-contaminated bilge waste.

OSG says the case is related to the ongoing Department of Justice investigation that began in 2003 regarding the handling of waste oils on OSG's vessels.

OSG says it continues to cooperate with this investigation and that its goal is to reach a comprehensive settlement in connection with the overall investigation. OSG does not believe that this action will have any material impact on its ongoing business, its relations with customers and vendors, or any of its contractual arrangements.

According to Captain Robert Johnston, Senior Vice President and Head of Shipping Operations at OSG, "We remain committed to being a responsible marine transportation services company and to maintaining the highest levels of operational standards on board our ships. The Company has implemented one of the strictest environmental protection programs in the industry and considers high quality technical operations across the fleet a top priority."