HMAS Choules is in waters off Vung Tau, south of Ho Chi Minh City.

The vessel is carrying asylum seekers intercepted by Customs and Navy vessels earlier this month, the West Australian newspaper reported on Friday.

A Defence source told Fairfax Media that HMAS Choules was headed to Vung Tau and would likely arrive late Friday or in the early hours of Saturday.

Members of the Vietnamese community in Australia claim people returned to the country face persecution by the Communist government in Hanoi.

The Abbott government has made it policy not to comment on "on water matters" as part of Operation Sovereign Borders.

Fairfax Media has sought comment from Immigration Minister Peter Dutton. It is the first major operation - at least publicly - on his watch since taking over from Scott Morrison in the cabinet reshuffle in December.

In a rare update in January, Mr Dutton revealed that 15 asylum boats containing 429 asylum seekers had been turned back since the government commenced Operation Sovereign Borders.

Last year, the government attempted to hand back 157 Tamil asylum seekers after keeping them detained at sea for a month aboard the Customs vessel Ocean Protector.

The Sri Lankan Tamils, who had taken to the sea on boats from a refugee camp in southern India, were not accepted back by the Indian government. They were eventually brought to Australia briefly before being transferred to Nauru.

HMAS Choules was sent to Manus Island in 2012 to provide offshore accommodation and support to Defence members and government officials. It has been put on standby to accept injured people during riots inside the Manus detention centre.

The West Australian reports HMAS Choules, has a daily running cost of $201,621, according 2012 Defence estimates. This means that a week-long voyage to return asylum seekers to Vietnam would cost at least $1.4 million – double if you include the return voyage.

By Heath Aston - The Sydney Morning Herald - April 17, 2015

Australia 'returning asylum-seekers to Vietnam'

Australia is returning almost 50 Vietnamese asylum-seekers using a warship currently off the Asian nation's coast after intercepting them at sea, a report said Friday, as Canberra enforces a tough immigration policy.

The asylum-seekers were found by customs and navy vessels north of Australia earlier this month before being transferred to amphibious landing ship HMAS Choules, The West Australian newspaper said.

The daily estimated that the cost of returning the asylum-seekers could reach Aus$1.4 million (US$1.1 million), adding that it was not known if they had already been transferred to local authorities.

A spokeswoman for the Immigration Minister Peter Dutton said she was aware of the report but told AFP "we don't comment on operational matters". A spokesman for the Defence Minister Kevin Andrews referred all questions to the immigration department.

The Australian government has refused to disclose details of its military-led operation to turn back vessels carrying asylum-seekers trying to enter the country.

But it said in January that "15 returns of various forms", including boats turned back to Indonesia and Sri Lanka, instances where asylum-seekers were taken back by foreign countries, and rescues at sea, had taken place since the start of the policy in September 2013.

Turn-back operations last year angered Indonesia, with tensions between the two countries growing after the Australian navy admitted entering the nation's territorial waters.

Since July 2013, Australia has sent asylum-seekers arriving on boats to detention centres on Papua New Guinea's Manus Island and Nauru.

They are denied resettlement in Australia even if they are found to be genuine refugees.

The newspaper report came several months after the High Court ruled that Canberra's detention of 157 Tamil asylum-seekers from Sri Lanka at sea for weeks in June last year was legal.

Their case centred around whether Australia had the power to remove asylum-seekers from its contiguous zone, just outside territorial waters, and send them to other countries. The asylum-seekers were eventually taken to Nauru.

Canberra has said the policy is necessary to stop asylum-seekers entering Australia by boat. They had previously been arriving almost daily in often unsafe wooden fishing vessels, with hundreds drowning en route.

Agence France Presse - April 17, 2015