Indonesia Seizes Iran, Panama-flagged Vessels Citing Illegal Oil Transfer

Indonesia said its coast guard seized the Iranian-flagged MT Horse and the Panamanian-flagged MT Freya vessels over suspected illegal oil transfer in the country's waters on Sunday.

Coast guard spokesman Wisnu Pramandita said the tankers, seized in waters off Kalimantan province, will be escorted to Batam island in Riau Island Province for further investigation.

"The tankers, first detected at 5:30 a.m. local time (2130 GMT on Jan. 23) concealed their identity by not showing their national flags, turning off automatic identification systems and did not respond to a radio call," Wisnu said in a statement on Sunday.

Wisnu told Reuters on Monday that the ships were "caught red-handed" transferring oil from MT Horse to MT Freya when they were discovered by the authorities and there was an oil spill around the receiving tanker.

He added that 61 crew members from both vessels have been detained.

The International Maritime Organization requires vessels to use transponders for safety and transparency. Crews can turn off the devices if there is a danger of piracy or similar hazards. But transponders are often shut down to conceal a ship's location during illicit activities.

Both the supertankers, each capable of carrying 2 million barrels of oil, were last spotted earlier this month off Singapore, shipping data on Refinitiv Eikon showed.

Very Large Crude Carrier (VLCC) MT Horse, owned by the National Iranian Tanker Company (NITC), was almost fully loaded with oil while VLCC MT Freya, managed by Shanghai Future Ship Management Co, was empty, the data showed.

NITC was not immediately available for comment.

A search by Reuters on Chinese company directory found that the registered office address of Shanghai Future Ship Management Co came under another firm named Shanghai Chengda Ship Management. Several calls made to the office went unanswered.

Iran, which has not commented on the seizure, has been accused of concealing the destination of its oil sales by disabling tracking systems on its tankers, making it difficult to assess how much crude Tehran exports as it seeks to counter U.S. sanctions.

In 2018, former President Donald Trump pulled Washington out of Iran's 2015 nuclear deal with six major powers and reimposed sanctions aimed at cutting Tehran's oil exports to zero.

Iran sent the MT Horse vessel to Venezuela last year to deliver 2.1 million barrels of Iranian condensate.

(Reporting by Agustinus Beo Da Costa; Additional reporting by Muyu Xu; Writing by Parisa Hafezi and Florence Tan; Editing by David Evans and Ana Nicolaci da Costa)