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Iran’s new dark shipping tactic to export gas to Asia

A visual open data survey examines new export tactics by Iran and how the US sanctions-ridden country may have managed to smuggle liquefied petroleum gas (LPG) out of the country for sale to Asia.

In April 2020, a 114.2 meter long vessel named LAUREN disappeared from the maritime monitoring room. Days later it appeared out of nowhere on international AIS screens in the same spot where it had disappeared.

It then entered UAE waters to rendezvous on several occasions with two other ships, one of which was operated by a US-sanctioned company.

What reads like the plot of a John le Carré novel is actually stranger than fiction.Within about ten days at the end of April last year, the LAUREN performed the magic trick not once but twice.

During the flashes of the dark seafaring, satellite images reveal the red ship anchored in an Iranian LPG port it would never visit – it falsified records by signaling that it was heading for a port in Kuwait.

As it is approaching an area less than two miles from the United Arab Emirates Exclusive Economic Zone (EEZ), operators believe it is safe to re-enable the AIS signal.

There it meets two ships, one of which is the GAS SELLAN, another liquefied petroleum gas tanker sailing under the flag of Vietnam.

Map of AIS records

The US authorities see the controversy in the operation and management of the vessel by the sanctioned Vietnam Gas And Chemicals Transportation Corporation, which does business in petroleum, chemical, LPG and bulk cargo transportation services.

Last December, Vietnam Gas and Chemicals Trans Corp (PCT.HN, formerly Cuu Long Petro Gas Service) was added to the “ Specially Designated Nationals and Blocked Persons ” (SDN) list drawn up by the US Office of Foreign Assets Control (OFAC ) at the United States Treasury Department.

The list includes entities such as terrorists and drug traffickers for which assets are blocked and with which US entities are not allowed to do business.

Operator rating sites such as IFMAT now indicate the entity with a red warning label.

It has been designated or sanctioned for contributing to “terror, weapons of mass destruction (WMD) and human rights violations”.

It lists significant transactions for the transportation of petroleum products from Iran on or after November 5, 2018.

40-year-old Vietnamese director Vo Ngoc Phung, involved in the company’s operations, was also listed on OFAC’s SDN. I contacted the company via email to request a statement regarding last April’s events.

At the time of publication, there was no response. What could have happened? According to forensic open data analysis, the behavior of three ships (see map with AIS signal records) is “extremely strange,” says an expert from a private satellite imaging company.

Data/credit: VesselFinder; Analysis:

After two days in port with the AIS signal switched off, the LAUREN will then meet with two ships on several occasions.

Each time, concept data before and after the encounters suggests that the Lauren has lost weight, indicating that some sort of transshipment may have occurred.

This all happened in the waters of the UAE, 200-500 meters off the coast of Dubai. The Strait of Hormuz is a busy place. It is the world’s foremost oil transit bottleneck because of its oil flow.

In 2019, the daily flow of oil averaged 21 million barrels per day, one fifth of the global consumption of petro liquids. Getting dark is by no means a safe endeavor (nor for large fishing vessels, we thought).

However, due to growing fears of attacks such as attacking tankers or drone shooting, some ship operators often opted to turn off their AIS signal, 2019 Bloomberg data suggests.

In the case of no AIS and encounters at sea with the LAUREN, the GAS SELLAN and the CROWN, now called Paula, let’s assume more elaborate intentions.

The behavior fits a general pattern that China has been showing more and more recently to import US-sanctioned Iranian oil to help finance the Islamic Republic.

According to a March WSJ report, China would import 918,000 barrels of oil per day in March. Now the appetite may have widened to the export of LPG.

IHS Markit recently cited strong demand for LPG from China amid a wave of new petrochemical plants being added.

Last April’s behavior, which may involve using Vietnamese US-sanctioned operators as a means of trade, is “suspicious,” said an expert from London-based marine intelligence firm Vessels Value.

The analyst could not say with certainty whether gas was actually being transferred from ship to ship, but believes that “something is clearly going on.” “They [the three ships involved] would not travel to the Middle East just to anchor and do nothing.

The changes in the draft of the ship – how deep the ship is in the water, to how heavily it is loaded with cargo – look suspicious, ”explained the representative.

AIS was developed as a navigational safety tool, says an expert. Switching off became a way of concealing where the ship’s position is.

Additional information from AIS, such as “next port of call” and so on, also disappears this way, says Jakob P. Larsen of BIMCO, one of the largest international shipping associations representing shipowners.

“Any ship engaged in nefarious activities can use it as a disguise. It is common in sanction breakers or illegal fishing activities. When they feel safe again, they turn it back on ”.

Guidelines from the US Departments of State and Treasury and the US Coast Guard state that “while security concerns can sometimes give rise to legitimate disablement of AIS transmissions, vessels engaged in illegal activities may intentionally disable their AIS transponders or transmit to mask their movement.

”Before the UN arms embargo against Iran expired in October 2020, UN Security Council sanctions did not restrict the export of petroleum from Iran.

Chemicals Transportation Corp (CUU Long Petro Gas Service) and the three ships involved in the affair last year demonstrate its involvement – but none of the company’s five own ships participated.

operates as the technical and ISM (International Safety Management) manager v an GAS SELLAN. A tanker’s manager is the entity responsible for the technical side of things, such as maintenance, Larsen explains.

The operator is more important for commercial operation and also for arranging transhipment activities. “The ship operator is responsible for the commercial operation of the ship, arranging for the customers, which cargoes are transported from A to B,” he adds.

In the case of the GAS SELLAN, the operator (and owner) is reported as FGAS Petro Co. The Hanoi City-based company was added to the ‘Dirty List’ last May, a roster of bad companies maintained by Burma Campaign UK, a human rights NGO.

It includes entities assisting the Myanmar military to continue to commit human rights violations.

FGAS Petro is an energy and shipping company that owns the Golden Amor bulk carrier, which operates the Ahlone International Port Terminal in Yangon, a terminal owned by the Burmese military and responsible for a bloody crackdown this spring against unarmed protesters in the country, killing hundreds.

Another vessel involved in last April’s events, the CROWN, now under the flag of Vietnam PAULA, is owned by Golden Lotus Oil Gas & Real, for which IMRRA’s commercial risk rating, targeting managers and operators, has a low trust score of 47 percent, making it a bold statement to the maritime industry that stakeholders are reviewing.

Nhat Viet Transportation Corp, the economic owner of the ship, IFMAT warns that the owner, PetroVietnam Transportation Corp (PVTrans), also carries significant risk to potential business partners.

PVTrans is said to have been involved in “several times deliberately transported Iranian petroleum products using its tanker fleet,” said ITMAT, a human rights organization specializing in Iran.

The LAUREN, which switched off its AIS signal when traveling to Iran’s LPG port last year, is owned by Golden Lotus Oil Gas & Real and managed / operated by Nhat Viet Transportation Corp.

For owners and managers involved in last year’s events, it could have far-reaching consequences than just freezing assets on US soil, Larsen says. You may have cascading effects.

If you are caught violating sanctions, enforcement imposed on you [as the owner] by US authorities may continue, depending on the case ”.

Analysts at HawkEye360, the Virginia-based satellite company developing remote sensing and radio frequency (RF) satellite intelligence capabilities, say it has found another LPG tanker, the OPEC ATHENA, involved in seemingly US sanction-breaking behavior in 2019.

The company used a model to find throughput. The affair with OPEC ATHENA, similar to the case in April 2020, also includes Vietnam Gas And Chemicals Transportation, this time as the ship’s ISM manager.

IHS Maritime names FGAS Petro as owner and manager. HawkEye360 cites evidence that the ship visited the petrochemical port of Pars (port Asaluyeh), while disabling its AIS signal (in a similar fashion to the LAUREN in 2020) and after anchoring in UAE, sailed to Dongguan, China, where it arrived in December of 2019.