Sale of Seized Iranian Tanker Could Be Ordered for Security Reasons, Sanctions Expert Says

By Natasha Phillips

[Excerpts from the interview with Mark Gray MBE have been added below this report.]

JUL 12 – An Iranian ship seized in Gibraltar last week which was believed to be carrying oil to Syria in breach of E.U. sanctions could be forfeited or sold if the Gibraltar Supreme Court considers those options to be in the interest of security, a sanctions expert has said. 

The captain and chief officer of the Iranian oil tanker were arrested by Gibraltar police officers on Thursday while the tanker remained impounded and investigations continued. 

The Government of Gibraltar authorized British Royal Marines to seize Grace 1 on suspicion that the vessel was traveling to the Banyas refinery in Syria. The refinery is owned by the Banyas Oil Refinery Company which is subject to E.U. sanctions and applicable in Gibraltar. 

Shortly after Grace 1 was seized, the Iranian government demanded the vessel’s release and said that Britain would face consequences for detaining the tanker. On July 11, the U.K.’s Ministry of Defence reported that three boats belonging to the Islamic Revolutionary Guard Corps (IRGC) tried unsuccessfully to intercept a British tanker in the Persian Gulf. The Iranian government denied the allegations. 

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The tanker Grace 1 and its cargo could be detained for lengthy periods under current laws enacted by Gibraltar but the vessel and its contents could also be forfeited or put up for sale, Anna Bradshaw, a partner and sanctions expert at the London based law firm Peters & Peters told Kayhan Life. 

“Forfeiture could be ordered if the Gibraltar Supreme Court is satisfied that the presence of the vessel or its cargo in the region is a breach of E.U. sanctions and forfeiture is either in the interests of justice, international peace and security,” she said.

“The Court can also order the sale of the vessel or its cargo if it decides that their continued presence in Gibraltar are a danger to security, or to the navigation of other vessels for example,” Bradshaw explained. 

On Thursday an IRGC deputy commander reacted strongly over the decision to seize Grace 1, telling Iran’s semi-official Tasnim news agency that the U.S and Britain would regret detaining the vessel. 

While the seizure has increased hostilities between Tehran and London, the decision to intercept the oil tanker by the British overseas territory would have been made very carefully, Mark Gray, a former colonel in the British Royal Marines and the founder and co-director of maritime logistics company MNG Maritime, told Kayhan Life. 

“In my experience working in the Ministry of Defence (MOD) the implications of such actions are fully thought through and the potential for unintended consequences fully considered. In this case, the government will likely have been hesitant to approve the operation because of the potential for escalation, and the likelihood that it would be seen as a tit for tat,” he noted.

“It must have been clearly determined that the imperative to prevent sanctions being busted and prevent the oil getting to Syria overrode that risk, and the legal grounds and intelligence must have been very strong,” he said. 

Ships carrying cargo from Iran to Syria usually pass through the Suez Canal, covering a distance of around 3,500 nautical miles. However, Grace 1 took a much longer route circling around Africa which would have seen the tanker travel 12,000 nautical miles to Syria. The tanker was carrying a large volume of crude oil and was unable on this occasion to pass through the Canal, forcing the vessel to make the alternate journey. 

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Gray said that the longer route, which included sailing through Gibraltar, could have created an opportunity for British forces to intercept the tanker. “As a fully laden, very large crude carrier (VLCC) Grace 1’s draft was too deep for her to pass through the Suez Canal, so the crew had no choice,” he added. “They could have chosen only to partially load, but it may have suited their purpose to bring more product and avoid the canal where a good deal of scrutiny is applied to ships passing.” 

The tanker’s future remains unclear in the wake of ongoing investigations around the vessel.

Bradshaw told Kayhan Life that any application to sell or forfeit Grace 1 could be contested by the Iranian government, but that any legal battle could be frustrated by the U.K.’s exit from Europe. 

Outlining the development, she said, “One very interesting question will be the extent to which the continued detention of the ship and its cargo will need to be revisited in the event that the U.K. exits the E.U. without a deal, given that the sanctions being enforced by the Gibraltar authorities are E.U. sanctions.” 

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“]The following are excerpts from the interview with Mark Gray MBE[/aesop_content]

With the current tensions between the U.S. and Iran, could a conflict break out in the Strait of Hormuz? 

That’s the million-dollar question. It is certainly not in U.K. or U.S. interests to have a war with Iran. It might suit Iran though. If Iran keeps goading, the U.S. will respond eventually. We might not want it, but we seem to be headed that way. Someone needs to ramp down rhetoric and calm things down.

However, it is difficult to see how tensions might ease. Iran wants sanctions lifted. The West wants Iran to stop sponsoring and supporting terrorism and not to make a bomb. The Obama deal got halfway there, but Iran kept supporting terrorism. Trump has lost patience. Iran is trying to push up oil costs by threatening Hormuz and generating instability. This ramps up tension.

The British government said IRGC officials tried to intercept a British oil tanker in the Persian Gulf this week but their boats were intercepted by the Royal Navy. What impact could this have in the region?

This development is interesting, because it now seems that the Royal Navy is escorting U.K. flagged ships through the strait. This is a big move. One of the unintended consequences of the same scenario in the 1980s was a surge in numbers of U.K. flagged ships as ship owners reflagged in the U.K. specifically to take advantage of the protection of the Royal Navy. I can see that happening again. 

Can you explain the military process behind the seizure of Grace 1 and how the Royal Marines may have organized the operation

The process of requesting marines called Military Assistance to the Civil Power (MACP) and it is a complex legal one. The process must be done because the military do not have any jurisdiction or authority in UK territory without that legal authorization. 

Under the United Nations Convention on the Law of the Sea a state has the right to board and search sanctions busting vessels, even on the high seas. Gibraltar authorities will have requested MACP from the U.K. and government lawyers will have verified and approved the legal grounds for boarding before passing the request to the MOD.

At that point the Fleet Contingent Troop (FCT) which is made up of around 30 men, will have been notified. They will the start the planning process (studying the ship’s plans, determining the boarding locations, trying to identify crew numbers and so on.) They will then move to Gibraltar with their kit and weapons, most likely in a single Hercules (C130) lift from RAF Brize Norton. 

The Royal Marines had a Lynx helicopter for the operation, and though I am not sure where that came from, there may have been a passing frigate or they could have flown one in a Hercules, but that would need a day to break down and a day to reconstruct. Once in Gibraltar the Royal Marines will have finalized their plans.

At a point determined by the Gibraltar authorities the execute order will be given along with a formal handover of authority, with signed documents, giving them the legal authorization to act. 

It is likely that the Lynx would have had “eyes on” for some time (they can watch using sophisticated optics from beyond 4 nautical miles away). Just before execution, the Lynx will have been brought back to Gibraltar to refuel and to collect the fast roping team of six to eight men. At the chosen H-hour, the rigid-hulled inflatable boats (RHIBs) and the Lynx will have appeared on either flank of the ship, and above the foredeck, and within about 2 minutes, there would have been 30 marines in control of the ship, on the bridge and down in the engine room.

Because the marines will not have known whether there were weapons on board, or whether any attempt might be made to run, or to crash the ship deliberately, they go in with overwhelming force, speed and shock, to gain control quickly and suddenly and prevent any opportunity to resist. It is also safer for the marines, when going into the unknown.

Once in control of the ship, and having mustered the crew, the marines will have searched the ship as quickly as possible which could be done in around an hour, in order to ensure nothing was missed. 

Gibraltar authorities would then be called forward and brought to the ship, and the marines would have “handed over” control back to them. They would then likely have retuned to Gibraltar and onto to their base in Plymouth to prepare for the next operation, or may have been held for extra security. The process of formal detention, legal authority and corresponding paperwork is then served on the Master.

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