A ship that sank at Christmas Island's port has a long history of defects, prompting environmentalists to call for an overhaul of maritime regulations.

The cargo vessel MV Tycoon broke its mooring and sank on Sunday in Flying Fish Cove after it was battered against the rocky coast while loading phosphate.

With it went 102 tonnes of intermediate fuel oil, 11,000 litres of lubricant oil, 32 tonnes of diesel oil and about 260 tonnes of phosphate.

Locals are trying to mop up the spill on the island, noted for the annual red crab migration which British naturalist David Attenborough once rated among his top 10 career moments.

Tourists flock to Christmas Island, 2600km northwest of Perth, to enjoy its world-class diving.

The Tycoon, built in 1983, is owned by Taiwanese firm Ocean Grow International Ship Management but sails under a Panamanian flag of convenience.

Greenpeace spokesman James Lorenz said an inspection in Malaysia in October revealed problems with the magnetic compass, ventilation, lifebuoys and other safety equipment.

In 2010, problems with radio communications, lifesaving and fire equipment, navigational safety and nonconformity with international oil pollution law resulted in the ship being delayed in Vietnam. "Most pertinently, its mooring arrangements and load lines were also found to be faulty," Mr Lorenz said yesterday. "It is shocking that this kind of rust-bucket is allowed to operate in Australian waters.

"Unless regulations are dramatically tightened, it is only a matter of time before we face a disaster of far greater magnitude."

International Transport Workers Federation co-ordinator Dean Summers said the ship's use of a flag of convenience indicated a degree of secrecy. "It will be difficult for the authorities to find someone to pin the damage bill on."