SINGAPORE - Singapore raised alert levels on Friday in the Asian financial centre and beefed up security at its airport and new casinos after a warning by its navy of possible attacks on oil tankers in a key shipping lane.

Singapore, Malaysia and Indonesia have already stepped up sea patrols in the Strait of Malacca after Singapore's navy said on Thursday it had received indications a terrorist group was planning attacks on oil tankers.

We received intelligence from our liaison partners about this possible plot to go and attack vessels coming through Singapore waters through the Strait of Malacca, Singapore's Home Affairs Minister Wong Kan Seng told parliament.

We should not be in denial. The threat is real and we are not immune from it ... we must recognise that no security system can be completely foolproof, Wong said in the Singapore government's first comments on the threat.

He said Singapore had hardened security, including at new casino resorts owned by Genting Singapore and Las Vegas Sands, developments the government hopes will boost tourism significantly.

Any attack could have a disproportionate effect on the global economy as well as on Singapore because the nearby and narrow Malacca waterway carries about 40 percent of world trade.

Singapore is home to the world's top container shipping port and is favoured by many multinationals as a base, from Citigroup to GlaxoSmithKline and ExxonMobil.

Wong did not give any indication of who the threat was from but militants have long had Singapore in their sights.

He said the recent capture or death of militant leaders in Indonesia had not discouraged recruits from terrorist acts.

ACEH CAMP RAIDED

Indonesian President Susilo Bambang Yudhoyono said on Friday a terrorist group was planning to launch attacks from a training camp in Aceh province, which police have raided.

Authorities there were investigating whether the group might be linked to the threat against shipping in the Malacca Strait, national police chief Bambang Hendarso Danuri said separately.

This is a truly a terrorist group which has organised itself well and chose training grounds in Aceh in the hope that people will not see Aceh as a conflict area anymore, Yudhoyono told reporters before a cabinet meeting.

They hoped that we will be off-guard and they can prepare everything to launch terrorism acts, the president said.

Yudhoyono did not identify the group. Indonesian police said some of the 14 suspects detained in Aceh included several who had received training in militant camps abroad.

Security analysts said regional Islamist militant group Jemaah Islamiah (JI), some of whose members trained with the mujahideen in Afghanistan and which once had links to al Qaeda, was a strong possibility.

Tito Karnavian, head of Indonesia's anti-terrorism squad, Detachment 88, told Reuters recently investigations into hotel bombings in Jakarta last year pointed to the re-establishment of a connection between al Qaeda and local militants.
A Saudi man and an Indonesian went on trial in Indonesia last month in connection with the suicide bombings on the hotels that killed seven people. Noordin Top, a former JI leader killed in a police raid last year, was the mastermind of those bombings.

Jemaah Islamiah has been responsible for a string of deadly attacks around the region, but has been dormant in recent years..

A JI plot for multiple attacks in Singapore was uncovered in December 2001. Internal security and policing in Singapore are far ahead of neighbouring states but the escape of a JI-linked militant, Mas Selamat Kastari, from prison in 2008 was a lapse that showed security is not infallible.

Malaysia re-captured Mas Selamat, a Singaporean, last year.

KEEPING LOOKOUT

The terrorism threat announced by Singapore could raise insurance costs for shippers plying the 900-km long strait that links Asia with the Middle East and Europe.

However, shippers and analysts say pulling off a terrorist attack at sea would be more difficult than bombing a hotel.

This has never happened (in the Malacca Strait). As far as I see, the possibility is quite slim. To do it on the sea and to do it on land is very different, said Widihardja Tanudjaja, CEO of Indonesian tanker firm Berlian Laju Tankers.
Still, he said Berlian's crews were on high alert.

The watch is improved, the night patrol and day patrol are circulating more often and on full alert. We will stay in communication every 10 minutes with the joint patrol forces, he told Reuters. Our trade schedule remains as normal.

The strait is more heavily patrolled compared to the open area off Somalia, where pirates have been able to board and hijack large vessels, including an oil supertanker in 2008.

It's not bandit country in the same sense as Yemen and Somalia. The security architecture now is far more robust, in terms of patrols, law enforcement, naval development, said Jason Alderwick, maritime analyst at Britain's International Institute for Strategic Studies.

(Additional reporting by Nopporn Wong-Anan, Fabian Ng and Harry Suhartono in SINGAPORE; Muklis Ali, Olivia Rondonuwu and Sunanda Creagh in JAKARTA; and William Maclean in LONDON; Editing by Bill Tarrant)

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