LNG Shadow Fleet, OFAC Sanctions, and Super Yagi – Weekly Roundup

It was a BIG week for OFAC and maritime risk, with sanctions announcements on September 9 and 10. One of the liquified natural gas (LNG) vessels recently sanctioned by OFAC is on the move and could be headed to your region – or it could offload its cargo to a vessel headed to your region…we’ve got the info you need. 

This week’s Global Trade Roundup also analyzes Super Typhoon Yagi’s potential effect on the global supply chain, as well as the deepening relationship between China and Libya. 

LNG Shadow Fleet Gets Sanctioned by OFAC

• The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) announced new sanctions against two companies on September 9, due to limited liability related to Russia’s Arctic liquified natural gas (LNG) 2 project. The companies:
  • Gotik Shipping Co, a Liberia-based company 
  • Plio Energy Cargo Shipping OPC Private Limited, an India-based company
• Two vessels were sanctioned in connection to these companies:
  • The Mulan (IMO: 9864837), commercially controlled by “Plio Energy” 
  • New Energy (IMO: 9324277), owned by “Gotik Shipping Co” as registered owner
• As with the other sanctioned LNG tankers, both the Mulan and New Energy are sailing under the flag of Palau and they are largely similar in size – 237-288 meters in length.

Windward’s Maritime AI™ platform shows that prior to being sanctioned, between September 3-9 the New Energy engaged in a commodity ship-to-ship (STS) meeting with the Pioneer, a recently sanctioned LNG tanker,  in the Egyptian EEZ near Port Said. This is another indication of the existence of the LNG Shadow Fleet.

• Windward’s Maritime AI™ platform detected that one of the LNG vessels recently sanctioned by OFAC is on the move. The Everest Energy vessel, which conducted location (GNSS) manipulation on August 21, but actually entered the LNG 2 Project in Utrenniy on August 23, departed the area of Murmansk, and is currently sailing in the Arctic Sea without updating its destination… 
• Additionally, as of September 10 the Mulan (mentioned above) was sailing North. New Energy was sailing within the Mediterranean, from its former port call in Spain, the Pioneer was still located in Egypt, and Asya Energy was still located in Russia, near Murmansk.

• The sanctioned vessels are on the move, but their final destinations are not yet clear. Windward’s solutions can help detect their movements and behaviors, and offer users a better understanding of the Russian LNG supply chain.

Convergence of National Security & Sanctions or Compliance Risk – OFAC Sanctions 9 Russian Vessels

• OFAC sanctioned individuals and entities linked to Russia and Iran’s Islamic Revolutionary Guard Corps (IRGC) on September 10. Additionally, OFAC sanctioned 9 vessels due to their illicit behavior and association with the Russian Ministry of Defense. The vessels:
  • Kompozitor Rakhmanin (IMO: 8606616)
  • Boriskustodiv (IMO: 9103817)
  • Omskiy 103 (IMO: 8889385)
  • Omskiy-119 (IMO: 8926913)
  • Port Olya-3 (IMO: 9481910)
  • Port Olya-4 (IMO: 9481934)
  • Vafa (IMO: 8422670)
  • Vafa-1 (IMO: 8422682)
  • Zakamsk (IMO: 8951413)

• Media outlets have been speculating, based on a comment by an Iranian lawmaker, that Iran may be sending weapons systems to Russia in exchange for Russian wheat and other grains. Iran has officially denied these allegations. It is possible that these sanctioned vessels might be enabling this illicit trade.
• Prior to the sanctions announcement, all of the nine vessels were flagged by Windward as high risk between 2013-2019, due to dark activities, port calls in sanctioned regimes, and loitering activities conducted in Iran and Russia, especially in the Caspian Sea. 
• For additional information, please read Windward’s new blog post.

Super Typhoon Yagi and its Impact on Supply Chain

• Super Typhoon Yagi (also called Typhoon Mojie in China) formed and struck Vietnam and later Hainan island, China, initially killing four people and injuring over 70 others, with many missing. There was major damage caused to infrastructure, such as mass power outages, making it the strongest typhoon “in a decade.” As of September 12, the death toll tragically rose to over 140, with the most casualties in Vietnam.
• Following the typhoon’s movement, the Transportation Departments of Guangdong and Guangxi announced that on September 6 the regional ports would close down, with Hong Kong and Macau copying this decision to prepare for the storm’s impact. Additionally, transportation via highways and railways in the region was suspended. 
• Windward’s Maritime AI™ platform found significant decreases in port calls by cargo vessels between the weeks of August 25-31 and September 1-7 in the following areas (weekly basis):
  • Hainan – 52.5% decrease
  • Macau – 49% decrease
  • Guangxi – 42.5% decrease
  • Guangdong – 34%
  • Hong Kong – 21.5%
• Last week’s data marks the lowest number of port calls since February 2024, around the Chinese New Year, an official holiday in China.

Port calls in the ports of Hainan, Macau, Guangxi, Guangdong and Hong Kong by cargo vessels, January 2-September 7, 2024.

Windward’s Ocean Freight Visibility solution shows shipments that were headed towards the ports of the affected areas and that were supposed to arrive at their port of destination (PoD) between September 1-10, 2024. Our Maritime Predictive ETA capability showed delays between 6-30 days, with most vessels shown to reroute and make a stop in Singapore and Malaysia to delay their arrival to closed ports.

• The typhoon has been downgraded to a tropical depression, but the impact will likely  affect the supply chain. The south of China, especially the county of Guangdong, is home to a significant portion of China’s automotive and electrical appliance industries. 
• The months of September and October are significant for the supply chain, as more carriers get ready for the holiday season and events such as “Black Friday” and “Singles Day.” It is possible that the impact of the typhoon could be seen over H2 of 2024.

Chinese-Libyan Strategic Partnership – Increased Chinese Presence in Libya

• The Chinese president, Xi Jinping, and the president of the Presidency Council, Mohamed al-Menfi, announced the establishment of a strategic partnership between the two countries. 
• The announcement was made at the Beijing Summit of the Forum on China-Africa Cooperation. According to Xi, China intends to support Libya’s development and rebuild its economy by strengthening economic, trade, and investment cooperation with China under the frameworks of the Belt and Road Initiative. 
• Windward’s Early Detection model shows that there was an increase last week in the number of port calls conducted by vessels owned by Chinese companies in Libya. Data shows that the number of port calls rose by over 100% on a weekly basis. The majority of port calls were conducted in the Misrata and Benghazi ports, two of the largest in Libya.

• Additionally, Windward’s Maritime AI™ platform shows that prior to the announcement, the month of August has seen the highest number of first time visits by Chinese-owned vessels in the Libyan territorial waters over the past two years. An increasing number (since August 2024) of Chinese companies have started operating in Libya for the first time.

First time visits to Libya by Chinese-owned cargo vessels and tankers, January 2020-August 2024.

• According to Chinese officials, China is interested in strengthening its bilateral connections to North African countries as part of the Belt and Road Initiative. China will invest over 14$ million in Egypt and help establish the Tunisian energy sector, mainly the renewable energy sector. 
• It is expected that more Chinese companies will start operating in the area, which is evidenced by the maritime trade between China and North Africa. Windward’s data can show how political agreements can affect maritime trade and show new patterns of operations.