World Tankers Management strongly denies wrongdoing after Indonesia seizes tanker

Strong words have been said following confusion surrounding the seizure of oil products tanker Strovolos (IMO 9178056) by the Indonesian Fleet Command I (Koarmada I) on July 27th, with approaching 40,000 tons of crude oil on board, the Navy stated on August 25th.

Rumours had been circulating this month about the seizure of an unnamed tankship, with the cause said to be that it had been anchored illegally in Indonesian waters, or possibly that the Cambodian government had asked that it be arrested.

It has since transpired that a complex legal situation could arise as a result of the charterer of the vessel going out of business earlier this year.

One allegation was that the tanker was wanted by Cambodian Government for “stealing” 40,000 tons (300,000 barrels) of crude oil, and that on July 24th a notice had been sent to Indonesian authorities to that effect..

The ship was detected and then secured in Anambas Waters. There were 19 crew members on board, 13 of them Indian nationals, three Bangladeshis and three from Myanmar. After being secured the ship was loaded with crude oil and sailed from Thailand to Batam. Its AIS was reported to have been kept turned off when transiting the Indonesian waters. The ship also said to have carried out anchoring manoeuvres in Indonesian waters without official permission.

The Strovolos was escorted to Batam to be further processed by the Batam Navy Base (Lanal). Anchoring in the Indonesian territorial sea without a permit by violating Article 317 in conjunction with Article 193 Paragraph (1) of Law Number 17 of 2008 can be fined with a maximum imprisonment of 1 year and a maximum fine of IDR (Indonesian Rupees)200m (US$13,830).

Meanwhile, the operator of the Bahamas-flagged products tanker, World Tankers Management, denied the claims that the vessel was transporting Cambodian crude oil illegally. The Singapore-based company said that the tanker was in Indonesia to conduct a “long-overdue”’ crew change. It called for the release all crew members.

WTM insisted that the vessel was in Indonesia purely for humanitarian reasons and that it had been operating within the scope of its charter. WTM said that the ship’s charterers loaded a cargo of crude oil at Cambodia’s Apsara field in the Gulf of Thailand back in May “on the understanding that the cargo belonged to the charters.”

After the charterers failed to pay, WTM said that the Strovolos and its crew sailed to Thailand to refuel and, while there, tried to conduct a crew change, as many of the ship’s crew had remained on board since September 2020.

WTM said that because of Covid-19 restrictions the crew transfer was never conducted and the charter was eventually terminated. At this point WTM requested the removal of the cargo by ship-to-ship transfer “at a convenient and practical location.” The company said that no agreement was reached.

When the vessel arrived in Thailand, said WTM, it was boarded by the Royal Thai Navy, supposedly at the request of the Cambodian government, but the Royal Thai Navy did not detain the vessel. It was allowed it to sail “following the intervention of lawyers, the IMO and the Bahamas Maritime Authority” WTM said that the Royal Thai Navy “stepped back and allowed the vessel to sail to Batam, Indonesia, to make the crew change there as it was not permitted in Thailand due to Covid-19 restrictions”.

WTM said that “we as owners stress that the reason for the vessel proceeding to Batam was for humanitarian purposes, to effect the long overdue crew change and allow the crew to return home to their families in accordance with their basic rights”.

The company added that “however, the owners have also been faced with difficulties affecting the necessary crew change in Indonesia. The vessel initially waited off Batam in view of the travel restrictions placed by Indonesia due to Covid-19. It is alleged by the Indonesian Navy that the vessel did not have permission to anchor in Indonesian waters.”

WTM has denied any wrongdoing and has alleged that there have been “wrongful allegations made by the Cambodian Government that the vessel and its crew had committed criminal offences in relation to the vessel’s departure from the Apsara field to refuel.”

WTM said that it was now worried about the well-being of its seafarers. It reported that it had been made aware that the Cambodian government had allegedly requested to Interpol that the crew be extradited back to the country.

Other media reports indicated that the Captain of the tanker, a Bangladesh national, had now been accused of anchoring in Indonesian territory without permission and that he could face up to one year in prison, plus fines, if found guilty.

“The vessel has been wrongly charged with stealing the cargo. It is not and has never at any time been our intention to misappropriate the cargo,” World Tankers Management said, adding that “it is our express requirement that [the cargo] is offloaded from the vessel by the party that owns it on terms that we are paid the sums owed to us or otherwise that such amounts are adequately secured in the usual way. The vessel has at all times operated entirely within the trading area agreed in the charter”.

Emphasizing once again the position of the crew, who were very much caught in the middle of what looks like an international and inter-company dispute, WTM said that “our crew are entirely innocent and blameless in this matter and should not come to bear the brunt of commercial and political issues. The human rights of our crew are paramount and all parties involved in this matter, including the Cambodian and Indonesian authorities, should recognise and respect this. As a result of this situation, we now have no choice but to involve diplomatic channels and the UN Human Rights Office”.

The Bangkok Post reported that the tanker had been chartered by Singapore’s KrisEnergy for storage as part of Cambodia’s recent bid to extract its own oil, Indonesian authorities said. It was said that KrisEnergy hit financial difficulties, was unable to pay its debts and filed for liquidation in June, still allegedly owing money to the tanker crew (see http://www.xinhuanet.com/english/asiapacific/2021-08/01/c_1310101136.htm). That liquidation caused Cambodia’s first-ever oil extraction to come to a full stop only a few months after it began. KrisEnergy had a 95% stake in the field, while Cambodia held just 5%. Unfortunately the yield, expected to be 7,500 bpd, never got above 1,000 bpd after its opening in late 2020.

 WTM, therefore, looks to have been caught up in the fallout of KrisEnergy’s liquidation, holding oil cargo on board that it would be happy to get rid of, with crew owed wages and WTM owed charterers’ fees. The oil cargo would also possibly constitute an asset of the liquidated company (in which case WTM would have some kind of claim on it as collateral for its fees), while Cambodia, presumably, claims that it remains the owner of the oil because KrisEnergy never paid for it.

As of August 26th the vessel was at anchor off Batam City in the Malacca Strait.

1999-built, Bahamas-flagged, 28,546 gt Strovolos is owned by Strovolos Shipping Co Ltd care of manager World Tankers Management Pte of Singapore. It is entered with London Club on behalf of Strovolos Shipping Co Ltd.

https://nasional.kompas.com/read/2021/08/25/10465011/tni-al-tangkap-kapal-tanker-strovolos-buron-pemerintah-kamboja