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Ships Vanish to Evade Sanctions on Iran

Ships Vanish to Evade Sanctions on Iran

Thursday, 4 July, 2019 - 11:00
An oil tanker carrying crude oil arriving in Zhoushan, China.CreditCreditVCG via Getty Images
New York - Michael Forsythe and Ronen Bergman
A week ago, a small tanker ship approached the Arabian Gulf after a 19-day voyage from China. The captain, as required by international rules, reported the ship’s position, course, speed and another key detail: It was riding high in the water, meaning it was probably empty.

Then the Chinese-owned ship, the Sino Energy 1, went silent and essentially vanished from the grid.

It reported in again on Sunday, near the spot where it had vanished six days earlier, only now it was heading east, away from the Strait of Hormuz near Iran. If past patterns hold, the captain will soon report that it is riding low in the water, meaning its tanks are most likely full.

As the Trump administration’s sanctions on Iranian oil and petrochemical products have taken hold, some of the world’s shipping fleets have defied the restrictions by “going dark” when they pick up cargo in Iranian ports, according to commercial analysts who track shipping data and intelligence from authorities in Israel.

“They are hiding their activity,” said Samir Madani, co-founder of TankerTrackers.com, a company that uses satellite imagery to identify tankers calling on Iranian ports. “They don’t want to broadcast the fact that they have been in Iran, evading sanctions. It’s that simple.”

A maritime treaty overseen by a United Nations agency requires ships of 300 tons or more that travel international routes to have an automatic identification system. The gear helps avoid collisions and aids in search-and-rescue operations. It also allows countries to monitor shipping traffic.

Foreign companies doing business with American companies or banks risk being punished by the United States under the sanctions, which went into effect last November.

“We have sanctioned dozens of Chinese state-owned enterprises for nuclear, missile, arms and other forms of proliferation ... but it is not entered into lightly,” said Richard Nephew, a research scholar at Columbia University who oversaw Iran policy on the National Security Council during the Obama administration.

Brian Hook, the United States special representative for Iran, told reporters in London on Friday that the United States would punish any country importing Iranian oil. Hook was responding to a question about reports of Iranian oil going to Asia.

American and Israeli intelligence agencies say the country’s Revolutionary Guard Corps is deeply entwined with its petrochemical industry, using oil revenues to swell its coffers. Trump has labeled the military group a terrorist organization.

Iran has been trying to work around the American sanctions by offering “significant reductions” in price for its oil and petrochemical products, said Gary Samore, a professor at Brandeis University who worked on weapons issues in the Obama administration.

Last month, the Salina, an Iranian-flagged oil tanker under American sanctions, docked in Jinzhou Bay, a port in northeastern China, according to data from VesselsValue, a website that analyzes global shipping information. The Salina regularly reported its position, course and speed via the automatic identification system.

Oil tankers like the Salina, which can transport as much as a million barrels of crude, or about 5 percent of the daily consumption of the United States, are so big that they can call on only a limited number of ports. They are also more easily spotted by satellites than smaller ships like the Sino Energy 1.

That vessel, and its more than 40 sister ships, are far more difficult to track when they go off the grid. They were owned until April by a subsidiary of Sinochem, a state-owned company in China that is one of the world’s biggest chemical manufacturers.

Sinochem has extensive business ties in the United States. It has an office in Houston and works with big American companies including Boeing and Exxon Mobil. In March, it signed an agreement with Citibank to “deepen the partnership” between the two companies, Sinochem said. In 2013, a United States subsidiary of Sinochem bought a 40 percent stake in a Texas shale deposit for $1.7 billion.

Frank Ning, the chairman of Sinochem, speaking in a brief interview in Dalian, China, said that shipping had not been central to the company’s business. In a statement, the company said it had “adopted strict compliance policies and governance on export control and sanctions,” though a former employee who had helped manage the shipping business, speaking on the condition of anonymity, said the company had shipped petrochemicals from Iran for years.

The tracking data also show that some of the Sinochem ships made trips to Iran before the fleet was sold, and both before and after the American sanctions went into effect.

In April 2018, for example, one of the ships, the SC Brilliant, was moored at Asalouyeh, a major Iranian petrochemical depot on the Arabian Gulf.

After Trump’s announcement last August that he would reimpose sanctions on Iran’s petroleum industry, the SC Brilliant’s voyages became less transparent.

In late September and early October, shortly before the sanctions took effect, the ship went off the grid for 10 days in the same stretch of the Strait of Hormuz where the Sino Energy 1 disappeared last week. When the SC Brilliant went off the grid, it appeared empty; when it re-emerged, it appeared full.

The pattern was repeated in February, with the ship disappearing for four days, according to the tracking data.

That month, another Sinochem ship, the SC Neptune, stopped transmitting its position when it approached the Strait of Hormuz, the tracking data show. Four days later, for a brief period, it appeared back on the grid, transmitting its location from an export terminal on Iran’s Kharg Island. It then went quiet for another 24 hours, reappearing on its way out of the strait.

In some parts of the world, including the South China Sea, it is not uncommon for ships to go silent because the automatic identification system may be overloaded by the volume of vessels, said Court Smith, a former officer in the United States Coast Guard who is now an analyst at VesselsValue. Sometimes they do so for competitive reasons, he added.

But in the Arabian Gulf, where traffic is lighter, Smith said, vessels generally do not turn off the system, known in the industry as A.I.S.

“If the A.I.S. signal is lost, it is almost certainly because the A.I.S. transponder has been disabled or turned off,” Smith said of ships in the Arabian Gulf. “The captain has decided to turn off the A.I.S.”

Another possible clue that Iran-bound ships are disabling their reporting systems is that ships making trips to countries on the western part of the gulf are not going off the grid.

The New York Times

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