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TBILISI | Sat Sep 5, 2009 12:03pm EDT

TBILISI (Reuters) - Georgia on Saturday released 17 crew members of a Turkish-operated tanker seized after trying to deliver fuel to breakaway Abkhazia in breach of a Georgian embargo, a court official said.

The Turkish captain, Mehmet Ozturk, remains in custody after being sentenced last week to 24 years in jail. The judge who sentenced Ozturk said his appeal was still under consideration.

Turkish Foreign Minister Ahmet Davutoglu is expected to raise the issue during a visit to Tbilisi next week, and has said the captain would be freed in exchange for an $18,000 fine.

"An hour ago Poti city court took the decision to release 17 crew members of this ship," Supreme Court spokeswoman Nana Vasadze told Reuters. Vasadze said 16 members were released on payment of 3,000 lari ($1,785) each. Another was released on payment of 10,000 lari ($5,952).

CNN Turk reported earlier that 16 crew members had been released.

Georgia banned all economic and commercial activity in its two breakaway regions, Abkhazia and South Ossetia, after last year's five-day war with Russia, when Moscow repelled a Georgian assault on South Ossetia, inflicting a severe military defeat on Tbilisi.

Russia has recognized Abkhazia and South Ossetia as independent states.

The dispute has raised tensions in the Black Sea, with Abkhazia threatening to "destroy" Georgian ships in retaliation. Russian forces control Abkhazia's de facto border, including its coastline.

The tanker, operating under a Panama flag with a Turkish and Azeri crew, was seized in late August in the Black Sea by the Georgian coastguard as it tried to deliver 2,000 tonnes of petrol and 700 tonnes of diesel to Abkhazia.

The tanker's operator, Dense, says the vessel, the Buket, was seized at gunpoint in international waters. Georgian coastguard authorities said the ship was detained in Georgian waters en route to Abkhazia.

Densa has said it would pay the fine to release the captain.

(Reporting by Margarita Antidze in Tbilisi and Ayla Jean Yackley in Istanbul, editing by Ralph Boulton)

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