Maritime Security: Moving Targets

While Somali piracy is in remission, other threats are multiplying.

The North Atlantic Treaty Organization (NATO) recently sponsored a maritime security conference that provided participants with an update on piracy and other threats to shipping. The conference, “Current and Future Challenges to Energy Security in the Maritime Environment,” covered a variety of issues but was clear on one point: Threats to shipping, from piracy to terrorism, are alive and well.

The Rise and Fall of Somali Piracy

Most of the maritime industry regards piracy as the most likely threat to their operations. And most equate piracy with Somali-based attacks in the Horn of Africa/Gulf of Aden region. That scourge saw a rapid rise and subsequent fall. Somali pirate attacks numbered 30 in 2007, peaked at 235 in 2011, then declined to only 15 by 2013. In fact, the last successful attack and ransom case was in May 2012, more than three years ago.

What led to the rapid decline? Experts cite an array of efforts to protect vessels including naval escorts (such as NATO’s own “Operation Ocean Shield”), the rapid adoption by industry of “best management practices,” and the use of private armed security teams. The employment of these teams, known as PMSCs (private maritime security companies), on commercial ships has been both a success and a source of controversy.

At the NATO conference, Peter Cook, CEO of the Security Association for the Maritime Industry (SAMI), which represents PMSCs, stated that “Private maritime security is a phenomenon that is here to stay. We aim to facilitate a good understanding of this evolving industry and how it can be part of the solution and not part of the problem.”

With more than 130 members in 38 countries, SAMI makes it easier for clients (shipowners, ship managers, charterers, flag states or marine insurers) to find and choose a reputable PMSC. It also works closely with the International Maritime Organization and the International Standards Organization to promulgate internationally recognized and certified standards for PMSCs – all part of an effort to combat the bad rap given the industry by, among other incidents, the Blackwater shootout in Baghdad in September 2007.

Ironically, the success of all of these efforts against Somali piracy has created a dilemma for both governments and industry, who are finding it harder and harder to justify the added expense of naval patrols off the Horn of Africa, or steaming at full speed (which can use twice as much fuel), or using PMSCs. And PMSCs now find themselves victims of their own success as shippers think twice about hiring them.

Piracy’s New Business Model

With Somali piracy in remission, the more pressing issue is piracy’s “new” business model, prevalent in places like the Gulf of Guinea and Southeast Asia, which is focused not on hijacking ships and crew and holding them for ransom but rather on stealing energy commodities and selling them in illegal markets.

In the Gulf of Guinea, the problem remains epidemic as first documented in the September 2013 Chatham House report Nigerian Criminal Crude: International Options to Combat the Export of Stolen Oil. That report concluded that Nigeria’s crude oil was being stolen on an “industrial scale.” However, it will be interesting to see what developments emerge in Nigeria following the election of Muhammadu Buhari earlier this year.

According to Michael Wingate, Chief Operating Officer at Guardian Global Resources, “Buhari has promised change, with particular emphasis on addressing the pressing and wide-reaching issue of maritime security, which encompasses the siphoning of crude oil from pipelines, cargo theft, piracy and kidnap for ransom activities. Intended action includes a shake-up of the companies operating in the maritime security space.”

Wingate says that security companies operating in Nigerian waters are anticipating further amendments to their procedures, which are expected to offer clarity and understanding in what is currently an opaque operating environment. With oil theft a crippling problem in an industry vital to the success of the Nigerian economy, the authorities need to do everything they can to mitigate the damage to their imports, exports and revenue.                                                                                                                      

A similar hotspot is Southeast Asia, where an outbreak of tanker hijackings and stolen energy cargoes has shippers on edge. The Regional Cooperation Agreement on Combating Piracy and Armed Robbery against Ships in Asia (ReCAAP) reported that piracy in the region is up 23 percent from 2013 to 2014. Of the 183 incidents in 2014, 13 were “very significant” and involved the siphoning of ship fuel or oil. ReCAAP estimated that at least three organized crime syndicates were involved in these incidents.

In the first six months of 2015, according to a report from the International Maritime Bureau (IMB), hijackings of small coastal tankers continued at a rate of one attack every two weeks. The IMB is part of the International Chamber of Commerce and a long-time authoritative source for statistics on reported pirate attacks. IMB Assistant Director Cyrus Mody noted that “Only seamless information sharing and coordinated action will result in a robust response to this threat. We hope the arrest of one gang and the hefty custodial sentences imposed on another will help deter further incidents.”

All About Oil

Instability in Libya and Syria has triggered a new scourge whereby non-state actors (other than traditional pirates or criminal syndicates) use tankers to sell stolen oil in illegal markets. The proceeds from such sales are likely reinvested in weapons and other contraband to support their military campaigns and terrorist attacks.

In Libya, the U.N. Security Council in March 2014 authorized sanctions and restrictions regarding the loading, transporting or discharging of crude oil from Libya. In mid-June 2015, the U.S. Coast Guard issued a port security advisory, telling vessels to proceed with extreme caution when approaching all Libyan oil terminals, particularly in eastern Libya, due to recent attempts by armed, non-state actors to engage in illicit exports.

Regarding Syria, George Kiourktsoglou, Guest Lecturer at Greenwich University in the U.K., made a presentation at the NATO conference on “ISIS and Smuggled Crude Oil.” His analysis indicated that oil shipments out of ports in the eastern Mediterranean – such as Banias, Syria and Ceyhan, Turkey – have surged at times when Islamic State rebels were taking over oil-producing regions in Syria and Iraq or otherwise in need of cash infusions to fund their military campaigns. 

Kiourktsoglou cautioned that the correlation he found does not conclusively prove that these shipments were directly funding Islamic State and added that more work needed to be done to determine whether the shipments were benefiting Islamic State or the Syrian government. “The effort to expose the illicit trade of crude oil and the corresponding transactions between Islamic State and established market participants will be an arduous one, requiring time and perseverance,” he explained. “It is the nature of similar seaborne trades that renders law enforcement particularly challenging.”

In any event, the U.S. Department of the Treasury recently placed sanctions on several shipping and energy companies for their roles in the ongoing Syrian conflict. Key companies targeted included Aqua Shipping and Milenyum Energy SA in Turkey, which were charged with materially supporting the Syrian government through various front organizations that were shipping oil products out of Banias.

Critical Chokepoints

The NATO conference ended on an unsettling note about additional threats to shipping in the Middle East. In a presentation titled “The Yemen Crisis and Its Implications for Energy Security in the Wider Gulf of Aden,” Dr. Peter Chalk, Adjunct Senior Security Analyst with the RAND Corporation, described the escalating civil war in Yemen, which was initiated by the Houthi rebels but has now been joined by Al Qaeda in the Arabian Peninsula, Islamic State, and neighboring nations led by Saudi Arabia.

Chalk noted that Yemen abuts busy shipping lanes on both the Gulf of Aden and Red Sea that are used for nearly 80 percent of European maritime trade. In addition, Yemen abuts the Bab el Mandeb, a critical chokepoint for shipping, which Al Qaeda in the Arabian Peninsula has vowed to close.

Yemen, of course, was the site of two major maritime terrorist incidents – the attacks on the guided-missile destroyer USS Cole in 2000 and the oil tanker MV Limburg in 2002. And Yemen is just across the Gulf of Aden from Somalia. In the current crisis, maritime instability has returned with pitched battles for control of the port city of Aden and a Saudi naval blockade of major seaports to prevent the Houthi rebels from getting supplies from allies like Iran. “Should the situation in Yemen continue to worsen,” Chalk concluded, “security in the Gulf of Aden will drastically deteriorate, making the viability of the Suez Canal corridor increasingly questionable.” – MarEx

Stephen Caldwell is a member of the National Maritime Security Advisory Committee. This is his first appearance in the magazine.