S E C R E T SECTION 01 OF 03 STATE 033109

SIPDIS

SIPDIS

E.O. 12958: DECL: 03/20/2018
TAGS: MNUC PARM PREL XB ZO ZP AE
SUBJECT: RESPONSE TO UAE MFA ON STATUS OF INTERDICTIONS

REF: A. STATE 129065 (M/V SINOTRANS QINGDAO)

B. ABU DHABI 1803

C. STATE 137596 (YM ENERGY)

D. STATE 16099

E. ABU DHABI 1965 (YM ENERGY MORE FOLLOW-UP)

F. STATE 155893 (M/V SEVENTH OCEAN)

G. STATE 027996 (M/V SEVENTH OCEAN FOLLOW UP)

H. STATE 11845 (M/V ANNA E)

I. MAGLEBY-MASILKO-SIDLER-EMAIL OF 01/29/2008

J. ABU DHABI 117

K. ABU DHABI 178

L. STATE 28977 (THAI POC)

Classified By: NEA/ARP Director A.Steinfeld for reasons 1.4 b,c and d

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SUMMARY AND ACTION REQUESTS
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1. (S) Embassy Abu Dhabi is requested to approach
appropriate United Arab Emirates (UAE) officials regarding
the four outstanding interdiction cases: YM Energy, M/V
Sinotrans Qingdao, M/V Seventh Ocean and M/V Anna E and
discuss the options for resolving them. Post should draw from
objectives below as appropriate. End summary and action
request.

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OBJECTIVES
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2. (S/Rel UAEG) Embassy Abu Dhabi should:

-- Express our appreciation for UAE officials, ongoing
actions to address mutual proliferation concerns; note the
UAEG,s first prosecution under its export control law as a
significant and positive step that is receiving high-level
attention in the USG.

-- Thank UAE officials for its continued detention of the
shipments from the YM Energy, M/V Sinotrans Qingdao, M/V
Seventh Ocean and M/V Anna E.

-- Inform the UAEG that the United States is willing to
provide assistance to help defray the costs associated with
detention of the subject cargoes and with the ultimate
disposition of the items. We would like to discuss with the
appropriate officials how to accomplish this.

-- Reiterate the importance we place on preventing these
cargoes from going to Iran, and the need to ensure the

cargoes, appropriate ultimate disposition.

-- Stress the importance of UAE working with Thai officials
to arrange for the return of the anhydrous hydrogen fluoride
from the M/V Anne E the appropriate owner.

-- Explain that we understand the UAEG need for additional
information about these shipments in order to make a case for
their continued detention.

-- Explain our intention to always provide as much
information as possible; remind officials that we have
provided follow up information on cases when new information
becomes available; note that at this time, we have no
additional information on these cases.

-- Explain that it maybe possible for the U.S. to provide
additional information if allowed discrete access to these
cargoes.

-- Convey our understanding that initial implementation of an
export control law and subsequent prosecution of violations
can be difficult. Emphasize U.S. willingness to lend
assistance.

-- Inform UAEG that we understand its highest training
priority is to receive nonproliferation training for its
prosecutors and judges; we are working to fulfill this
request and have a tentative timeframe for early June.

-- Offer the possibility of arranging training on
investigative techniques related to counterproliferation
cases, including parallel construction of evidence - the
process of building a legal case independent of the
information used to initially uncover an illegal activity.

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Also, suggest that the LEGAT would be willing on a
case-by-case basis to help UAE officials build their
interdiction cases.

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REPORTING DEADLINE
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3. (U) Please report delivery of demarche and any
substantive response by March 27, 2008.

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BACKGROUND
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4. (S) M/V Sinotrans Qingdao: Since September 13, 2007 UAE
officials, at U.S. request (Ref A), have detained a shipment
of 14 metric tons of steel tubes from the CMA CGM-chartered
Liberian-flagged M/V Sinotrans Qingdao from China to Iran via
Jebel Ali, UAE. The shipment was destined for Iran,s
Defense Industries Organization (DIO). DIO is designated
under the Annex A of UN Security Council Resolution (UNSCR)

1737. In October 2007 UAE officials provided Post with
information on and photos of the containers that UAE had
detained at U.S. request, to include the M/V Sinotrans
Qingdao. (FOR EMBASSY USE ONLY: These photos were shared
with the intelligence community for analysis). UAE requested
that the U.S. provide any additional information because they
wanted to move towards final disposition of this cargo. (Ref
B).


5. (S) YM Energy: Since September 30, 2007 UAE officials,
at U.S. request (Ref C), have detained a shipment of 20 tons
of chromium alloy seamless tubes from the Liberian-flagged YM
Energy from China to Iran via Dubai. The U.S. initially
believed that the shipment was intended for the Iranian firm
Shahid Hemmat Industrial Group (SHIG) which is designated in
Annex A of UNSCR 1737. The consignee was Machine Pardazan
and their address was the same as that used by the Iranian
office of the Turkish firm Multimat. Mani and Milad Jafari
are known brokers for SHIG and have used Machine Pardazan as
a cover for these procurements. In October 2007 UAE
officials provided Post with photos and further information
on this cargo. UAE requested that the U.S. provide any
additional information because they wanted to move towards
final disposition of this cargo. (Ref B)


6. (S) YM Energy (continued): In December 2007 the U.S.
provided UAE officials with new information indicating that
in addition to the Jafari network and Machine Pardazan,s
past involvement in procurement for Iran,s ballistic missile
program, we had information that the shipment was related to
Three Stars Services Co. (TSS Co.) and that a commercial
invoice was provided to Milad Jafari. TSS Co. is a cover name
for Iran,s Sanam Industrial Group (SIG) and/or the Sanem
al-A,emmeh Industries Group (SAIG). SIG is designated in
UNSCR 1747 and both SAIG and SIG are subordinate to Iran,s
AIO. SAIG is responsible for developing cruise missiles and
SIG develops tactical missiles. In parallel, we provided the
Chinese with the same information. (Ref D) In December 2007
UAE officials informed Post that UAE is pursuing the matter
with the Chinese Ambassador in Abu Dhabi and the UAE Embassy
in DC. (Ref E)


7. (S) M/V Seventh Ocean: Since November 2007 UAE officials,
at U.S. request (Ref F), have detained a four ton shipment of
potassium perchlorate that was consigned to a cover company
used by Iran,s DIO in order to circumvent UNSCR
restrictions. Potassium perchlorate can potentially be used
in a variety of military related applications including in
the production of small rockets and explosives. It can also
be used as an igniter in ballistic missile systems.


8. (S) M/V Seventh Ocean (continued): In March 2008 the U.S.
provided UAE officials with more information that directly
linked this shipment to Iran,s DIO. In particular, the U.S.
informed the UAE that the foreign purchasing manager for DIO
was responsible for arranging this shipment. Chinese
officials were also notified at this time that the shipment
was seized in Dubai and were urged to work with UAE
authorities to return the cargo to the Chinese company of
origin (Ref G).


9. (S) M/V Anne E: Since January 14, 2008 UAE officials, at
U.S. request (Ref H), have detained a shipment of anhydrous
hydrogen fluoride from the M/V Anne E shipped from Thailand
to Iran via Dubai. AHF is an Australia Group-controlled
chemical weapons precursor and is included in the Nuclear
Suppliers Group (NSG) gas centrifuge and reprocessing
watchlists (for items that would be subject to &catch-all8

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controls for nuclear purposes.) It also has applications in
the refining of uranium, the production of fluorine and
aluminum fluoride, and as an addition in liquid rocket
propellants. On January 29 the UAE provided analysis of the
detained cargo and accompanying photographs of what appear to
be containers of Chinese-origin AHF (Refs I). The MFA also
provided assurances that the shipment of AHF is impounded and
requested USG assistance in approaching Thailand to issue a
prompt recall order (Ref J). UAE requested the U.S. approach
Thai officials for a point-of-contact with whom they can
reach out to directly regarding the final disposition of this
shipment (Ref K). The U.S. provided the UAE officials with
the Thai point-of-contact for this shipment (Ref L) and UAE
officials should be encouraged to work with this POC to have
this material returned to its appropriate owner.

End background.

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POINT OF CONTACT
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10. (U) Washington points of contact for follow-up
information is Edna Sidler, (202) 647-5347,
sidlerej@state.sgov.gov or Chris Herrington, (202)
647-5035,herringtonc@state.sgov.gov. Please slug all
responses for ISN, T, EAP, and NEA. Washington appreciates
Post,s assistance.
RICE