A British-owned cruise ship has smashed into pristine coral reefs, causing extensive damage in a remote corner of Indonesia known as one of the world's most biodiverse marine habitats, researchers and officials said Tuesday.

Raja Ampat in eastern Indonesia has long been a top attraction for intrepid travellers and avid divers, home to palm-fringed islands surrounded by an underwater kaleidoscope of coral and fish.

But the 4,200-ton Caledonian Sky slammed into the reefs at low tide around Kri, one of hundreds of small islands in Raja Ampat, earlier this month after taking the tourists aboard on a bird-watching expedition.

The boat, which was carrying 102 passengers and 79 crew, became grounded on the reefs and had to be refloated by a tug boat before continuing on its journey.

The accident has damaged an estimated 13,500 square metres (145,000 square feet) of coral reef which could cost up to $16.2 million to restore, according to Ricardo Tapilatu, a marine researcher from the University of Papua who headed a team assessing the impact.

There has been outrage in the local tourism industry which relies on Raja Ampat's natural wonders for its survival.

"How can this happen? Was a 12-year-old at the wheel?" Stay Raja Ampat, a website that links tourists up with homestays, said on its Facebook page.

"Anchor damage from ships like these is bad enough, but actually grounding a ship on a reef takes it to a whole new level."

- 'Very big loss' -

Head of Raja Ampat's tourism agency Yusdi Lamatenggo confirmed the accident, which took place on March 4.

Environmental group Conservation International said that the Bahamas-flagged ship had gone into an area that it should not have entered due to the unique coral reefs.

"This is a very, very big loss for us," Victor Nikijuluw, the marine programme director at Conservation International Indonesia, told AFP.

"Even when (the reefs) grow back, they will not be as pristine as they were before," he added.

Local search and rescue agency officials said they were called to help when the ship ran aground and had intended to evacuate the passengers immediately.

"However when we reached the site and spoke with the captain of the ship as well as one passenger, they refused to be evacuated and asked instead for a tug boat," local agency chief Prasetyo Budiarto told a television station.

But the tug took numerous attempts to refloat the massive vessel, causing even more damage to the reef.

The ship's operator, Britain-based tour company Noble Caledonia, said in a statement they were working with the Indonesian government to reach an agreement in relation to any damage caused.

"The company is firmly committed to the protection of the environment and as such deeply regrets any damage caused to the reef," it said.

The Indonesian government said it was assessing the impact and would seek compensation from the operator.

The remote archipelago of Raja Ampat -- which means Four Kingdoms in Indonesian -- lies between the Pacific and Indian oceans. A 2002 report from Conservation International said it was home to nearly 1,400 varieties of fish and 603 species of coral.

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