Indonesia says coal on hold for PH after 7 sailors abducted

Kanupriya Kapoor and Manuel Mogato, Reuters

Posted at Jun 24 2016 03:53 PM

* Unclear if Abu Sayyaf behind latest attack

* Filipino woman abducted with executed Canadian freed

* Indonesia to keep moratorium on coal until Manila secures waters

JAKARTA/MANILA - Indonesia's foreign minister said on Friday a halt on coal shipments to the Philippines will remain until Manila can secure its waters after seven Indonesian sailors were kidnapped, the latest in a string of abductions.

Seven Indonesian sailors kidnapped, held hostage in PH: govt

Philippine authorities could not immediately confirm the hostage-taking but said a Filipino woman held since September was freed on Friday by Abu Sayyaf, an Islamist militant group that has amassed tens of millions of dollars from kidnappings for ransom.

Abu Sayyaf frees Filipino hostage

It was unclear whether the sailors were taken by Abu Sayyaf, which has beheaded two Canadian nationals in recent weeks after ransom deadlines passed. The group is still holding Malaysian seamen and Japanese, Dutch and Norwegians.

Indonesia is concerned that piracy in the Sulu Sea area, a major sea traffic corridor for the world's top thermal coal exporter, could reach levels previously seen in Somalia.

"The moratorium on coal exports to the Philippines will be extended until there is a guarantee for security from the Philippines government," Indonesian Foreign Minister Retno Marsudi told reporters.

Indonesia supplies 70 percent of the Philippines' coal import needs, which Indonesian data shows stood at about 15 million tons, worth around $800 million, last year.

Analysts say $40 billion worth of cargo passes through those waters a year, including supertankers from the Indian Ocean that cannot use the crowded Malacca Strait.

Marsudi said earlier the seven Indonesians were kidnapped by two different armed groups in attacks on a tugboat towing a coal-carrying barge and that the government would "try all options to free the hostages".

Fourteen Indonesians were abducted in two separate assaults on tugboats during March and April but were freed in May. In April, the Indonesian navy instructed all commercial vessels to avoid piracy-prone waters near the southern Philippines.

Filipino captive Marites Flor was released at dawn on Friday near the house of the governor of the southern island of Jolo and was undergoing a medical checkup at an army hospital, the army said. She was abducted from a resort in September along with Canadian Robert Hall, who was beheaded on June 13.

There was no information on why she was freed or if a ransom had been paid.

"She is physically okay," said Major Filemon Tan, a spokesman for the military's Western Mindanao Command.

Tan said troops were checking reports of the seven Indonesians being kidnapped.

Alarmed at the frequency of attacks, port authorities in some areas of Indonesia, particularly Kalimantan on the island of Borneo, have stopped issuing permits to ships taking coal to the southern Philippines.

Philippine officials said the government was working to address piracy and coal importers could tap other suppliers, which would push up costs for consumers.

"There will be additional transportation costs if the coal will come from Australia or Russia so that means additional costs," said Rino Abad from the Philippine department of energy.

The rise of sea hijackings prompted Indonesia, the Philippines and Malaysia to agree to hold coordinated patrols in future to secure the region's busy waterways. (Additional reporting by Fergus Jensen in JAKARTA and Enrico Dela Cruz in MANILA; Writing by Kanupriya Kapoor and Randy Fabi; Editing by Martin Petty)