Russian Journalist Murders, and Gazprom

by craig on June 1, 2007 4:32 pm in Russia

I believe I may have found the way to post the original text of my Recent Mail Russian articles, without taking over the whole weblog:

Two months ago, 51 year old Ivan Safronov, defence correspondent of the authoritative Kommersant newspaper in Moscow, came home from work. He had bought a few groceries on the way, apparently for the evening meal. On the street where he lived, as he passed the chemist’s shop in front of the cluster of grim Soviet era apartment blocks, he met his neighbour, Olga Petrovna. She tells me that he smiled from under his hat and nodded to her. After a mild winter, Moscow had turned cold in March and Safronov held his carrier bag of groceries in one hand while the other clutched the lapels of his coat closed against the snow. Fifty yards further on he arrived at the entrance to his block, and punched in the code – 6 and 7 together, then 2 which opened the mechanical lock of the rough, grey metal door at the entrance to the concrete hallway. He passed on into the gloomy dank corridor.

The identification this week of a ‘former’ KGB officer, Andre Luguvoi, as the chief suspect in the murder in London of dissident Alexander Litvinenko, and Russia’s curt refusal to extradite him, reflects once again just how ruthless and audacious Putin’s Russian has become and how little we can do about it. But in fact there is a less obvious, but more sinister, danger from the Kremlin that threatens the future security of every British citizen.


MOSCOW

Two months ago, 51 year old Ivan Safronov, defence correspondent of the authoritative Kommersant newspaper in Moscow, came home from work. He had bought a few groceries on the way, apparently for the evening meal. On the street where he lived, as he passed the chemist’s shop in front of the cluster of grim Soviet era apartment blocks, he met his neighbour, Olga Petrovna. She tells me that he smiled from under his hat and nodded to her. After a mild winter, Moscow had turned cold in March and Safronov held his carrier bag of groceries in one hand while the other clutched the lapels of his coat closed against the snow. Fifty yards further on he arrived at the entrance to his block, and punched in the code – 6 and 7 together, then 2 which opened the mechanical lock of the rough, grey metal door at the entrance to the concrete hallway. He passed on into the gloomy dank corridor.

So far this is a perfectly normal Moscow scene. But then – and this is the official version of events – Ivan Safronov did something extraordinary. He walked up the communal concrete stairs with their stark iron rail, until he reached his apartment. It is, in British terms, on the second floor. Instead of going in, he carried on walking, past his own door. He continued up another flight and a half of steps, to the top landing, between the third and fourth floors. Then, placing his groceries on the floor, he opened the landing window, climbed on to the sill, and stepped out to his death, still wearing his hat and coat.

Ivan Safronov thus became about the one hundred and sixtieth – nobody can be certain of precise numbers – journalist to meet a violent end in post-communist Russia. In the West, the cases of Anna Politkovskaya and Alexander Litivinenko hit the headlines. But in Russia, there was nothing exceptional about those killings. It has long been understood that if you publish material which embarrasses or annoys those in power, you are likely to come to a very sticky end.

This Mail on Sunday investigation seeks to lift the lid on the limits of freedom in Putin’s Russia.

Safronov had a reputation as a highly professional journalist, meticulous about checking his facts. He was by no means a sensationalist, but had over the years published articles which embarrassed the Kremlin, about bullying, prostitution and suicide among Russia’s conscript armed forces, and about high level corruption which deprives the troops of adequate clothing, rations and equipment.

He had recently returned from a large trade fair in Dubai, attended by senior representatives of Russia’s armed forces and defence industries. He told colleagues at Kommersant that he had learnt something there about corruption in major arms contracts, involving exports to Syria, Iran and other destinations. He had told his editor he had come back with a ‘Big story’. But, as usual, he was carefully checking up on his facts first.

Now his story will never be published.

I walk through the dirty Moscow drizzle to a police station in the foot of the apartment block opposite Safronov’s. The officer in charge is brusque. There are no suspicious circumstances and the case is closed. Why am I wasting his time, and trying to cause trouble? He threatens to arrest me, so I beat a hasty retreat to find Safronov’s flat, past the chemist’s shop, in the footsteps of his last walk. In the muddy yard between the blocks, unkempt drunks squat for shelter at the foot of scrubby trees, drinking cheap vodka from the bottle.

I look up at the top landing window from which Safronov fell. It doesn’t look terribly high. Outside the block entrance, I stop and look down at the patch of ground on which he landed. The surface is an uneven patchwork of brick, concrete, asphalt and mud. Here a passing group of young men found Safronov, writhing on the ground, conscious but unable to speak. It took almost three hours for an ambulance to come. According to Kommersant Deputy Editor Ilya Bilyanov, although plainly alive when finally taken away, he was declared dead on arrival at hospital.

A stout old lady beating her rugs in the rain gives me the combination to go in to the apartment building. Once through the heavy metal door, I am overwhelmed by the smell of fresh paint. . Everything in the stairway – walls, ceilings, rails, doors, window frames – has been covered in lashings of thick oozing paint, as though to cover over any trace of recent events. The paint has been slapped on so thick that, even after several days, it remains tacky.

I pass the door of Safranov’s flat and continue up to the top landing. At the cost of some paint damage to my coat, I pose in the window from which he allegedly threw himself. It is certainly quite easy to open and clamber out, but it is a bad choice for a suicide. Soviet flats are low-ceilinged, and I calculate the window is a maximum height of 26 feet above the ground. I don’t know about you, but if I was to kill myself by jumping, I would choose somewhere high enough to make death instant. The very next apartment block, for example, is two storeys higher. As I peer down from the window I realise that, jumping from here, you are almost certain to hit the porch roof jutting out below. That is only about twenty feet down. The Moscow police claim that marks in the snow on the porch roof were the firm evidence that Safranov jumped.

Two middle aged ladies pass with their shopping. I explain that I am investigating Safranov’s death; it seems an improbable suicide. ‘Very strange,’ they agree, ‘Very, very strange.’ They go on to volunteer that Safranov was a pleasant man, had a very good wife, did not drink excessively and was much looking forward to the imminent birth of a grandchild. Plainly, everything they say is questioning the official version, but they do not wish to do so openly. They conclude by shaking their heads and repeating their mantra ‘Very, very strange,’ as they scuttle on into their flats.

Ilya Bilyanov, Safronov’s boss, is more categorical. Safronov was a devoted family man, very protective of his wife and daughter and proud of his son, about to start University. Bilyanov says: ‘He could not have killed himself. He loved his family too much to abandon them.’

EKATERINBURG

The flip side of the cheapness of human life in Russia is a capacity for individual heroism. Tatiana has it. I meet her in an Ekaterinburg television studio. She was just 25 years old and teaching her primary school class when she received a message that her husband, Eduard, had been murdered.

‘I just didn’t want to believe it’, Tatiana tells me, ‘We had always feared this might happen, but still you hope that there is some mistake’. She raced to the scene, where she learnt that he had been shot in the back with a shotgun at point blank range as he got into his car, while going about his duties as Editor and owner of Novy Reft, his local paper. He was 30 years old.

Tatiana returned home and had the heartbreaking task of explaining to their three year old son that daddy would not be coming home, ever again. She hugged and comforted him until 2am, when he finally fell into a deep sleep. Then she set to work. There was a newspaper to edit, a newspsper she had co-founded with her husband, producing the arly editions together in her bedroom.. Having put her son to bed, she now worked until 8am when she put the newspaper to bed. Then she took the boy to her mother and drove back to her classroom, apologising for being a bit late that morning.

That is the kind of determination required of those trying to keep media freedom alive in Russia.

Her husband, Eduard Markiewicz, had packed much in to his short life. Born in the Ukraine, he grew up near Chernobyl. Following the disastrous explosion of the nuclear power station, the family were evacuated two thousand miles East, to Asbest in the Urals. The town got its name from the World’s largest Asbestos plant which provided work for the men, while the World’s largest chicken farm and egg factory provided work for the women.

Accommodation and an allowance had been provided for the evacuated Chernobyl families, but to his horror Eduard’s father discovered that both were being stolen by corrupt Asbest officials. The family squatted, hewing a shack from the surrounding forest, and Eduard started school. He grew into a bright young economist, and in the mid 1990′s, aged just 23, was in charge of reform and privatisation in the district. He watched in horror as the industrial assets of the region passed into the hands of criminals, in league with corrupt officials. As elsewhere in Russia, they were bent simply on stripping and selling off the assets which they had gained for next to nothing, and in keeping the workforce going without pay for as long as possible.

According to the CIA, over half of Russia’s biggest bamks are under the direct control of criminals. Academic studies estimate the percentage of the Russian economy controlled by criminals at between 40 and 70 per cent. This situation dates back to the chaos of the original privatisation process, in which assets of incredible value ‘ like the oil industry ‘ were sold off for a tiny faction of their value, often knowingly to criminals, as pre-existing criminal gangs had been running a black private sector throughout communism.

Criminals were sharp off the mark and they had capital. As the communist state broke down, they could bribe police and authorities, and physically intimidate everyone else. Those in charge of Russia’s privatisation prrcess believed the Leninist teaching with which they had been indoctrinated, that the early stages of capitalism are always criminal. They therefore perversely accepted this criminal involvement as a necessary part of the process. According to Aliza Dolgova, who in the 1990′s was working on countering the mafia in the National Procurator’s Office, ‘When it came to privatisation, nobody asked,where did you get all this money?’ The Russian privatisation process therefore became at the same time the biggest rip-off in history, creating individuals of incredible wealth at a stroke, and the biggest money-laundering esercise in history.

In the new millenium, Putin sought not to confront the criminal oligarchs, with many of whom he had built up a close relationship while heading the KGB. Instead, as long as they supported him unquestioningly, he continued the process of their legitimisation while promoting loyal KGB men to senior positions across the country. Russia is now run by a strongly interlinked KGB and mafia elite. Both elements are equally vicious and ruthless.

Eduard Markiewicz tried to use his position to reduce corruption and abuse, and was promptly fired. So, aged just 25, he started up an independent newspaper dedicated to exposing the abuses of the authorities and the mafia in his region. His old contacts within government, and disgruntled workers from asset stripped factories, gave him plenty to publish, and his newspaper quickly became popular and influential locally and enabled him, together with Tatiana’s teacher’s salary, to scrape a modest living for the five years until his murder.

In the weeks before his death Eduard had launched a crusade on the appalling conditions of the asbestos and power workers and the terrible illnesses, particularly lung disease, from which they were suffering. In the very week of his death the paper had been leading with a story about the management of large prison camps for young offenders in the region. The corrupt Governor of the camps had been illegally hiring out large gangs of teenagers to private companies to labour on construction sites, living and working in appalling conditions. There had been several deaths in consequence. The fees had gone straight into the Governor’s pocket.

Eduard had been investigating further aspects of this case, which may have included renting out female inmates for the local mafia to run as prostitutes. Tatiana admits there are many people who wanted her husband dead, but is personally convinced that it was the Governor of the prison camp who ordered it.

The local police reacted quickly and efficiently to Eduard’s death, which occurred in a town in the forest outside Asbest. There was only one road out, and the police soon picked up a stranger who could not convincingly account for his presence in the area. With Tatiana is Sergei, regional representative of the Russian Union of Journalists. He tells me me that he had gone the next day to the police station where the man was held. The police there told him that they were sure they had the right man; he was a known Mafia killer and he had a shotgun in his car. But ten days later the man was released on the authority of the Regional Procurator, who stated there was no evidence against him. ‘I have no doubt the local police had the killer, and somebody higher wanted to protect him’, says Sergei.

Tatiana continued to produce the newspaper for a year, facing continual threats. Petrol was poured on her front door and it was set alight. A message threatening her son was thrown through the window on a brick. She came to a reluctant decision: ‘I so much wanted to keep Eduard’s work alive,’ Tatiana says, ‘But in the end, which was more important ‘ his newspaper or his son?’ For the first time in our interview, she startes to tremble.

She was forced to give up, close down the newspaper, and move to Ekaterinburg. Her story ends happily; she has remarried and runs her own PR company. But Asbest remains in the control of an interlocked mafia and corrupt authority, whose abuses now go unreported.

Ekaterinburg, the regional capital, is the city where Tsar Nicholas II and the Tsarina Alexandra, and all their children, were shot. The Bolsheviks were so thorough they even shot their pet dogs.

Those controlling the city now are just as ruthless. It is under the control of the Uralmash gang. Every business in the city, from market stalls to large factories, still pays protection money to the gang, which emerged triumphant from gang wars for control of the city around the millennium. This period saw the creation of the famous mafia cemetery monuments. One gangster, killed in a shootout, is lovingly portrayed jangling the keys to his Mercedes from his stone hand. This new genre is springing up all over Russia ‘ a recent Moscow mafia monument has the deceased’s actual gold chains and gold rings embedded into his statue, which is floodlit and guarded day and night.

Having eliminated the opposition, the Uralmash gang started to take over the businesses and metamorphosise into respectable businessmen and politicians. They took over the City administration, not only buying up officials but contesting elections themselves with their own political party ‘ the Uralmash Social and Political Union. This pattern can be found across Russia. One feature of the ideological void left by the fall of Communism is that ordinary people are not just cowed by criminals, but to a significant degree actually approve of criminality as evidence of strength and manliness.. There is also a widespread popular view that you get more ‘Trickledown’ from criminals than corrupt politicians, who are less integrated into the local economy. Criminals live in their community, spend their money freely, and employ a lot of local labour in their gangs and, increasingly, ‘legitimate’ businesses.

The Russian economy is now as dependent on oil and gas exports as that of Saudi Arabia, and has boomed in recent years with the high oil price. The criminal elites ‘ both inside and outside government ‘ have been the chief beneficiaries.

So Uralmash essentially own Ekaterinburg, including the hotel I am staying in. The Imperial nightclub, which occupies part of the building, very much reflects their tastes. The club’s sign is a brand new Range Rover mounted high on a plinth outside the door. Once inside the d’cor is heavy red velvet and gold ormolu, punctuated by large metal replicas of the Audi symbol hanging on wires from the ceiling, the interlocked metal rings threatening to noose the unwary reveller.

On this day, underneath the Range Rover sits a large BMW. It is being given away as a raffle prize this evening in the club. I buy a ’6 admission ticket, which is also the raffle ticket. I enter the club through the metal detector, at which other guests are checking in their machine pistols to the cloakroom. As the evening gets late, the club fills up, both in the little disco downstairs and the casino upstairs. But there are never many more than a hundred people in the club, and door receipts must be at most a thousand pounds. Against a top range BMW?

I ask the spectacular young lady on the casino reception how this works. She explains that the car is a ‘reward’. Gradually I work out what this means. In the casino, people are throwing their money around ostentatiously, but in the tens of pounds or occasionally hundreds, not the thousands. Spending in the bar is fairly restrained too. And if you can look beyond the flocks of gorgeous young ladies who comprise most of the clientele ‘ and I confess I had some difficulty bringing myself to look beyond them ‘ the majority of the men are young and beefy, with short haircuts, wearing T shirts and sports gear. They have ‘Hired muscle’ written all over them. The Imperial club is not where the leaders of the city hang out, it is a social facility for the lower level thugs. The ridiculous raffle prizes are crumbs from their masters’ table.

According to Mikhaal Melnikov of the Russian Union of Journalists, Ekaterinburg has become the most dangerous place for journalists outside Chechnya, with a whole spate of killings and beatings throughout the region. One editor of a local news agency was seriously assaulted three times in a year. Nobody is ever convicted. I am moving on with a more profound understanding that, in Putin’s Russia, the criminals and the authorities are the same thing.

The next day, as I leave the hotel for the airport, they are wheeling in a Volvo to replace the BMW as the next prize.

SHOLKOVI

The Russian Union of Journalists sponsors the Centre for Extreme Journalism. That is a literal translation; the meaning is closer to the Centre for Journalism in Extreme Situations. The Centre is fighting a losing battle to defend journalists against a tide of violence. At the Headquarters of the Centre for Extreme Journalism in Moscow, Mikhail Melnikov drew me a pyramid. He explains: ‘There are many killings, but they are only the apex of the system of intimidation of journalists in Russia. This starts with threats and intimidation, moving on through sackings to severe beatings.’

Combined with Putin’s relentless concentration of the media into government hands, the resulting self-censorship means that investigative journalism has almost completely died out, in a country where it is desperately needed. In 2001 Russia’s only independent national TV station, NTV, was forcibly taken over by state energy company Gazprom on the direct instructionof Putin. Gazprom has since bought out two independent national newspapers while a third, Kommersant, was three months ago acquired privately by Alisher Usmanov, the Chairman of Gazprom Invest Holdings.

Vladimir Velmoshni was a retired schoolteacher who disliked the rampant corruption he saw in his town, Sholkovi, some 50 miles outside Moscow. So he started up a small weekly newspaper, Sholkovianka, in his kitchen. He concentrated heavily on corruption and used some very effective techniques. He ran a photo series showing the palatial new houses and dachas of local officials, with details of their small official salaries underneath. The message was very clear. He also obtained a stream of incriminating documents, sent to him by his web of ex-pupils working in offices across the city.

The stunned citizens flocked to buy the paper, until it was selling one paper for every six inhabitants. It was only a matter of time. Three years ago, Vladimir drove home, and as he got out of his car he heard footsteps running up behind him. He was felled by a huge blow with a wooden club which fractured his skull. He lay on his back with his legs raised to try to ward off the blows which two big young men were raining down on him, lifting his jacket over his head to try and protect it.

‘There is no doubt they were trying to kill me,’ he grins at me in his office, ‘But I am not so easy to kill, and I have a loud voice.’ His cries brought passers-by running to his aid. He was very lucky ‘ that rarely happens in Russia, where it is safest to keep your head down. His assailants ran off, having narrowly failed to land the killing blow.

After a week in intensive care he discharged himself, so he could get out the next edition of the paper. He was crippled for a year by the damage to his legs. Now hale and hearty, he is back and crusading again, concentrating this week on judicial corruption: ‘It is rubbish to say that our courts are independent. They are very corrupt.’

There is however one change. After nearly being killed, he decided he needed protection ‘ ‘a roof’, as Russians call it ‘ and allied himself with a local businessman who invested in his paper. Has that limited his independence? ‘Well, there is one direction, one group, where I am going easy. But is that a problem where there are so many legitimate targets?’

It is a bit of a problem, Vladimir, but understandable.

TAGLIATTI

I meet Alexei Mironov at his flat in Tagliatti. He is a pleasant, bespectacled young man who makes me an instant coffee in his kitchen. He is very relaxed considering that he has one of the most dangerous jobs in the world. He is the third editor of the Tagliatti Observer (Tagliattskoi Obozrenya). The first two were assassinated.

Tagliatti is the home of the massive Lada complex, which still churns out 750,000 cars a year. The complex was built by Fiat, and the town is named after a leader of the Italian communist party. We may think of Lada as a joke, but the business has a very real turnover of eight billion dollars a year. It was a great prize in the looting of assets by criminals that passed for privatisation in Russia. The result was a small but real war in Tagliatti that left over 300 shot dead in 1996 alone. A gang called SOK eventually won the turf war, while the majority of ‘legitimate’ looting was accomplised by Boris Berezovsky.

That same year Valeri Ivanov and his friend Alexei Sidorov decided to launch a newspaper to campaign against the violence and corruption. The catalyst was provided when Valeri obtained photographs of the local mayor socialising with the gangster behind most of the killings. They were the focal point of the first issue. They printed 20,000 copies which sold out in a morning, in a town of just 160,000 people, and they had to print more.

Yeltsin decided to launch a blitz against organised crime at Tagliatti. Thousands of police ringed the massive factory complex and swept through it, sealing and removing all documents. They were taken to Samara, the regional headquarters, where they became the basis for Operation Cyclone, russia’s largest ever operation against organised crime.

Then on February 10, 1999, Samara police station burnt to the ground, killing 77 police and staff. All the evidence was destroyed. Despite eye witness accounts that fierce fires had started simultaneously in three different locations, both sides of a major internal fire wall, the official inquiry concluded that the fire was an accident, probably caused by a cigarette.

I met Valeri’s sister in a local pizza restaurant. Whether innocently ot ironically, the restaurant is called ‘Sicily’ and the piped music was the theme from ”The Godfather’. Irina, who is an accountant, told me that between 80 and 90 per cent of local businesses pay protection money. This has now been legitimised. Massive hoardings all the way into town advertise the ‘Security services’ of subsidiaries of SOK. It would be very unwise not to hire them.

Irina tells me that her brother Valeri had always had an inquiring mind; ‘You could say he was something of a natural rebel,’ she says, ‘He did not accept authority without understanding for himself.’ At school in Soviet times he had committed the appalling heresy of questioning the dictums of Lenin. His communist teachers had warned he would come to a sticky end, but it was to happen in a new Russia and in a context they would never have dreamed of.

Powered by Valeri’s crusading and the skills of his friend Alexei Sidorov, who turned out to have a talent for investigation, the paper went from strength to strength, with its audience riveted by the gang wars and the top level corruption that lay behind them. In 2001 it won a grant from the Soros Foundation and went daily. Valeri was elected to the City Council and there seemed a real possibility he might run for mayor, replacing the corrupt incumbent. Then in August 2002 he was shot dead at close range as he got into his car to drive home from work.

Alexei Sidorov took over the editorship. He was a good professional journalist and had no political ambitions. That did not save him. Less than a year later he too was killed on his way home. As he unlocked his car, he was stabbed 18 times with a sharpened metal file from a Lada workshop.

In Valeri’s case, the police quickly made an arrest. A car worker named Evgenni Manninger confessed, but it rapidly became plain that he had no motive and no connection with the killer. In fact the police had picked up a patsy who was something of a loner, and tortured him into confessing. The marks of torture were visible and Valeri’s family were so keen to have a real investigation they helped Manninger with his defence. However when Manninger was acquitted, the case was ‘suspended’. Irina went to see the Procurator, ‘he was really rude and aggressive towards me’, she says. He dismissed her with the words ‘You have no right to question the quality of our work.’

When Alexei Sidorov was then murdered, the cover’up threatened to become a national scandal. This led the Deputy Minister of the Interior, Boris Grizlov, to issue a statement denying any possible political motivation behind the murders and describing the Sidorov case as ‘Domestic violence’. Grislov has been one of Putin’s closest allies for decades and is now Speaker of the Russian parliament.

In all, five journalists have been murdered in Tagliatti, and a sixth died in a suspicious car crash. The current editor, Alexei Mironov, takes me to visit the offices of the Tagliatti Observer, where they have developed a neat line in gallows humour. Rima Mihareva has been Deputy Editor throughout. She is a cheery, bustling, motherly soul. ‘I edit the copy, choose the photos, make the coffee and organise the funerals’, she explains cheerily.

Alexei believe that Putin gave the signal that led to the murders of his two predecessors. ‘When Putin closed down NTV, the only independent national televison, local authorities took it as a signal that the time of independent media in Russia was over and they could act against them,’ he says. Valeri Ivanov was murdered just one month later.

I am introduced to the Chief Reporter, Sergei Davidov. He shows me a steel helmet he has just been given as part of the Artem Borovik Prize. This Russian award for investigative journalism is named after a bright young journalist who was killed in 2000 in a light plane crash, widely believed to be sabotage, while investigating abuses in the oil industry.

The first Artem Borovik award had been given, posthumously, to Valeri Ivanov. The next several awards had tended to be posthumous too, not as a matter of policy, but simply because good investigative journalists in Russia have a very, very low life expectancy. Last year they chose a living recipient, Anna Politkovskaya. She was murdered before the award ceremony.

Sergei doesn’t look scared. ‘Really, there is no point in worrying about it,’ he says, ‘I just do my job’. Nor is the paper backing down. They are celebrating today, having forced the resignation of a judge after a series of articles on corrupt judgements in land allocation cases. They acknowledge that the judge has already pocketed enough money for a very comfortable retirement indeed. Still, small victories are rare, and must be savoured.

As we smile and drink tea, I am painfully aware that I am looking at one of the last fading embers of freedom in Putin’s gangster state.

Craig Murray was a member of the British Diplomatic Service for twenty one years. He studied Russian in St Petersburg. Diplomatic postings included First Secretary in the British Embassy in Warsaw. He was British Ambassador to the former Soviet republic of Uzbekistan from 2002 to 2004. He is now Rector of the University of Dundee

His book ‘Murder in Samarkand ‘ is available in paperback.

GAZPROM

The identification this week of a ‘former’ KGB officer, Andre Luguvoi, as the chief suspect in the murder in London of dissident Alexander Litvinenko, and Russia’s curt refusal to extradite him, reflects once again just how ruthless and audacious Putin’s Russian has become ‘ and how little we can do about it. But in fact there is a less obvious, but more sinister, danger from the Kremlin that threatens the future security of every British citizen.

Which building in Europe houses the greatest potential power over Britain’s citizens? Is it the House of Commons or 10 Downing St? Is it rather the European Parliament or Commission? Perhaps the White House, or the Kremlin? This skyscraper, shelled in blue glass and topped by a pyramid, already holds a tremendous concentration of power, and it is growing. In ten years time its occupants will have the ability to make all Europe tremble. This is the corporate headquarters of Gazprom, Russia’s monopoly gas giant.

According to the European Commission, Europe currently gets 23% of its energy from natural gas. They predict that will increase to 30% by 2016. Already Europe is heavily dependent for this on Russia ‘ which means on Gazprom. Some EU states like Slovakia and Bulgaria already get 100% of their gas from Russia, and many get over 50%. 43% of Germany’s gas comes from Russia, as does 27% of France’s. Both figures are set to increase dramatically, as Gazprom’s Nordstream project comes on line and as Western Europe’s ‘ and especially Britain’s ‘ natural gas reserves dwindle fast.

For technical reasons, unlike oil, natural gas is much more heavily dependent for large scale transport not on tankers but on fixed pipelne systems. There is much less capacity with gas for short term switching of supplier on the spot market. The EU as a whole is already highly dependent on Russia and yet is moving further into a position inside ten years where any interruption of Gazprom supplies, particularly in winter, would be devastating. There would be no way to avoid massive economic shutdown and numerous deaths among the vulnerable. By 2016 Gazprom will have the ability to cause more damage, just by turning off the taps, than the Red Army could have done short of nuclear war. Does this matter, or can we trust Russia? And how did our political leaders let us drift into this position?

Did nobody planning the ‘Dash for gas’ worry that in the long term the gas would have to come from Russia? On the face of it, Britain is better placed than most of the EU. Very little of our natural gas comes from Russia, and we have entered long term contracts that tie up most of Norway’s production. But does anybody believe that, with Europe in chaos and essential services and industry short of power, both the UK and Norway could resist the politicla pressure to share out the available gas? In fact, the UK is especially vulnerable ‘ we are a leader in the UK for the percentage of our electricity generated from natural gas. Anyway, we are strategically and economically dependent on Europe, which takes half our exports. Chaos there would knock our economy sideways.

The central skyscraper, surrounded by matching smaller blocks, sits in a massive, highly guarded compound in suburban Moscow. Getting in is more difficult than crossing many international borders. There is a twelve foot fence, razor wire, and a small army of armed guards, with rigorous document inspection for visitors. Eventually my passport is accepted and I am admitted. Inside the miles of pristine marble corridor and dark wood paneling seem brand new. Through a maze of corridors I am ushered in to the very grand room of Sergei Kuprianov, press spokesman for the Chairman of Gazprom. Sergei looks young and sharp, in a well-cut silk suit. But his manner is curious for a press spokesman; far from emollient, he is arrogant, even combative.

I start off with some emollient questions. I ask whether Gazprom is considering branching off into alternative, carbon-friendly technologies. ‘No,’ Kuprianov replies bluntly, ‘We are only interested in serious commercial propositions. We do not regard wind or solar technologies as practical.’ I probe a little further about public concern about global warming. ‘Fortunately public opinion in Russia has no interest in such matters,’ he says brusquely. Denis Ignatiev, Head of Gazprom International Media Relations Division, has been sitting deferring to Ignatiev but here thinks it politic to add that that Gazprom sponsor an award for scientific advances in alternative energy technology. Kuprianov glares at him.

Coming closer to the point, I ask Kuprianov if Western Europe should worry about its increasing dependency on energy supplies from Gazprom. ‘Not at all’, he says, ‘this is a commercial transaction guaranteeing security of supply. We are committed to long term contracts. This is normal business.’

Only normal business is the last thing Gazprom is involved in. Gazprom is perhaps the most important tool in Putin’s armoury. He keeps a close eye on it. The Chairman of Gazprom is Dmitri Medvedev, First Deputy Prime Minister, close Putin ally and a possible Putin choice for his successor. The Trade, Energy and Foreign Ministers are all represented on the board at ministerial level.

Gazprom has been the instrument by which Putin has reasserted Russian hegemony over the Former Soviet Union, blackmailing European ex-Soviet countries by cutting off energy supplies in winter, and buying up the Central Asian ex-Soviet countries by taking over the heart of their economies.

More surprisingly, Gazprom is key to Putin’s harsh internal control. Mr Kuprianov often appears on the nation’s TV screens, which is easily explained. A year after taking power, Putin decided to stamp out independent media in Russia. When NTV, the only independent national TV channel, was closed down in 2001, it was Gazprom Media who took it over and turned it into a propaganda arm of the Kremlin. Gazprom went on to buy up Russia’s two large independent national newspapers. The last significant remaining one, Kommersant, was bought last November personally by the sinister Uzbek oligarch Alisher Usmanov, chairman of Gazprominvest Holdings. The Editor-in-Chief was immediately sacked while the longstanding defence correspomdent, Igor Safronov, mysteriously fell out of a window three months later.

Gazprom now controls a whole raft of formerly independent media outlets, encompassing TV, radio and newspapers from national to local level. All faithfully echo the Kremlin line. The era of free speech, ushered in by Mikhail Gorbachev through glasnost and perestroika, is now over.

Last week in the Mail on Sunday, I explained that there are two elements to the oligarchy in Putin’s Russia. The criminal Russian Mafia were in an exclusive position to benefit from the incredible fortunes to be made from Russia’s flawed privatisation programme. Putin has legitimised and co-opted them in return for their unwavering political support.

The second element are Putin’s own people, members of the KGB and former security services. The leading Russian social expert, Olga Kryshtanovskaya, has calculated that 58.3% senior officials under Putin are drawn from the security services, compared to just 4.8% under Gorbachev.

This month Alexander Lebedev, billionaire banker, oligarch, and an MP from Putin’s own party, told the BBC that the huge fortunes of Russia’s billionaire businessmen are smaller than the incredible secret fortunes built up by Putin’s current corrupt ministers. He named the Russian Minister for Social Security as perhaps the richest.

The effects are obvious. In mid-April, Garry Kasparov, former world chess champion, attempted to lead a peaceful march of 2,000 opponents of Putin. They were surrounded by 9,000 heavily armed security services who broke up the proposed march with much gleeful violence. Last weekend the EU-Russia summit in the city of Samara saw a minor diplomatic spat, as German Chancellor Angela Merkel complained that Kasparov and a few supporters had been detained at Moscow airport, and prevented from coming to demonstrate at the summit. Putin dismissed Kasparov as ‘Marginal’ and ‘having little popular support’, going on to ask rhetorically: ‘What is pure democracy anyway.’ He certainly does not seem to understand that democracy is a system in which minority views are not repressed.

Putin has waged a ruthless campaign to eliminate any major independent players from the Russian economy, be they foreign investors or wealthy businessmen not under his control. Shell’s purchase in 1994 of a 50% stake in the massive Sakhalin 2 oil and gas project ‘ the largest in the World ‘ was hailed as the great breakthrough for foreign investment in Russia. After seven years of harassment and obstruction under Putin, last month Shell were finally forced to sell up their stake for a bargain $7.5 billion. The buyer? Gazprom, naturally.

I ask Kuprianov whether this means foreign investors are no longer welcome in Russia. I was expecting a bland response assuring me that Russia remained open. Instead the reply made me sit up. ‘Russia no longer needs any foreign investment. Back in the 1990s, we lacked capital and we lacked expertise. Now we have plenty of both. We don’t need foreigners taking advantage of our resources. Russia will develop its raw materials itself.’

Ouch. Recently BP has been under pressure in much the same way as Shell, over its TNK-BP Russian joint venture. I confidently predict Gazprom will take that one over, too. BP also this year had the temerity to bid for some of the assets stripped from Putin opponent Mikhail Khodkorvsky’s Yukos group. Not surprisingly Gazprom won, in auctions which were not transparent, to say the least.

Merkel’s chiding of Putin was a welcome breakthough in straight-talking by the EU on the situation in Russia, yet it is Germany which has pioneered the policy of basing European energy strategy on gas supplies from Russia. The key development in this is the Nordstream project, a $9 billion joint venture owned 51% by Gazprom and 49% by German groups BASF and EON to bring a great pipeline straight into Germany from Russia via the Baltic Sea. A prime motive is for the route is political – to avoid the need to pass through Poland and the Baltic States, which remain from bitter experience deeply distrustful of Europe’s growing dependence on Russia.

Back in Moscow Gazprom’s spokesman, Kuprianov, explains that Gazprom’s plan is gradually to double gas supplies to Western Europe over a ten year period. Nordstream, and a Southern pipeline through Turkey to Italy, are key to this.

Nordstream is certainly high-powered. Its Chairman is former German Chancellor Gerhard Schroeder, who moved to take over this highly remunerative position immediately on retirement as Chancellor, in which position he had secured German government backing for the scheme and the necessary commitments to long term purchase contracts. For Schroeder to commit Germany to massive dependence on Russian energy supplies, and then move so quickly to join the project, raised rather fewer eyebrows in Germany than might have been expected.

In an effort to counteract reasonable fears across Europe, Nordstream has adopted the corporate slogan ‘Secure Gas Supply for Europe’. Many believe that slogan is designed to cover up the danger and convey the opposite of the truth.

So it all comes back to the question, how far does Europe trust Putin, and his successors? With the media completely under state control, freedom of speech heavily curtailed, and all opposition parties effectively banned from elections, at least we appear to be finally twigging that Russia is not a democracy ‘ although the British government has been remarkably reticent among EU countries in noting the fact.

The murders of Politkovskaya and of Litvinienko, and of scores of journalists, should make us wary of the ruthlessness of the Russian authorities. So should the viciousness of Putin’s attack on Chechnya, which cemented his popularity and his position at the shaky start of his Presidency. It was not only Politkovskaya and Litvinenko who believed that the Russian security services carried out the bombings of apartment blocks in 2000 which justified that attack. I can tell you for certain that many professionals in the FCO believe it too, and I personally read reporting from our Embassy in Moscow which took it very seriously indeed. As highly respected Russia expert David Satter, who at the time of the bombings was Moscow Correspondent of the Financial Times, wrote in his book Darkness at Dawn: ‘Both the logic of the political situation and the weight of the evidence lead overwhelmingly to the conclusion that the Russian leadership itself was responsible for the bombings of the apartment buildings’. The Russian leadership are completely ruthless: Europe should avoid dependence on them at all costs.

In Moscow, I asked for a bottle of Georgian wine with my dinner. I was stunned that there was none ‘ the best wine in Moscow restaurants always came from Georgia, and some of it was very good. In fact there is now no Georgian wine in Russia at all, as Russia has imposed a trade blockade over a variety of political disputes. It has caused massive hardship in Georgia, 80% of whose wine was exported to Russia.

Russia will impose bullying trade blockades at the drop of a hat. Crucially, Russia has at various times in recent years cut off gas to Ukraine, Georgia, Belarus and Armenia, while its client state Uzbekistan has cut off gas to Kirghizstan and Tajikistan. These blockades have usually been imposed in depth of winter, deliberately causing enormous hardship. They have been motivated by a variety of dispute.

Gazprom turning off the taps is therefore an established ploy of Russian foreign policy. So far it has not been used outside former Soviet states ‘ but there are three of those in the EU. To date, Western Europe is not yet dependent enough for the weapon to be quickly effective. That is definitely changing, even as there is a notable long term deterioration in diplomatic relations between Russia and the West.

Some argue that we need not worry as it would not be in Gazprom’s financial interest to halt supply. That presumes Gazprom to be a normal commercial venture, which plainly it is not. Russia is a hydrocarbon exporting economy which has benefited enormously from record oil prices. It has built up substantial foreign reserves and these will continue to grow for the forseeable future. It could survive a gas standoff, particularly as its people are more inured to hardship than Western Europeans. Sanctions in international relations, from trade blockades to war, all carry an economic cost and if commercial interest were the overriding factor they would not happen. But they do happen, and to imagine Europe will not have a security problem because otherwise Gazprom would lose money, is na’ve in the extreme.

Of course, it is not necessary for such a threat to be used for it to be effective. Europe’s dependence on Russia could just lead to a policy of meek subservience. David Clark, who I knew as a Foreign Office special adviser and is now Chairman of the Russia Foundation said last month ‘I do not believe in the Pearl Harbour scenario where Europe suddenly becomes completely dependent on Gazprom and the Kremlin shouts ‘Gotcha’. I do believe there is a process … going on under which European politicians will realise it is not in their interests to get on the wrong side of Russia.’

Tony Blair may go down in history as the most stupid man ever to have control of British foreign policy. He saw a terrible danger to the UK from WMD in Iraq, where there were none. He has been completely indifferent to Europe’s drift into energy domination by Russia. In April 2006 Gazprom entered into talks with an aim to purchasing a major stake in Centrica and British Gas. The Financial Times reported on 26 April that Tony Blair had decided there should be no attempt to block this. The next day the No 10 spokesman clarified that Blair thought it was a matter of ‘free trade’ and was against ‘economic nationalism’. Amid general incredulity that Blair believed that Gazprom practised ‘Free trade’, George Soros, the billionaire financier and philanthropist, contradicted Blair, pointing out that Europe was relying on ‘a country that does not hesitate to use its monopolist power in devious and arbitrary ways.’

Accepting Soros’ wisdom, what can Europe do? One solution is to obtain alternative supplies of natural gas. The only viable major alternative sources are in the Caspian and Central Asian regions.

But at present gas from these regions can only reach Europe through Russia itself, and thus is controlled by Gazprom. There has therefore been great Western interest in building a pipeline out bypassing Russia, either through the Caspian Region to Turkey or Greece or through Afghanistan through Pakistan to the Arabian Sea. The United States has put a great deal of muscle behind this efforts.

Putin and Gazprom have provided an effective blocking game. The Caspian pipeline would have to pass through Azerbaijan and Georgia. Massive Russian pressure has been brought to bear, including cutting off energy supplies. Again, Kuprianov of Gazprom was brutal in replying to me about these proposed pipelines: ‘I would like to see who in that region would dare to die with the US!’ he snorted.

Gazprom’s other tactic has been to secure for themselves the gas reserves of Central Asia. Turkmenistan, with a population of only 5.5 million, has the World’s third largest reserves of natural gas. A fortnight ago Putin toured the key Central Asian states, signing gas deals in each, the key one being an agreement with Turkmenistan to expand the Prikaskipsky pipeline and massively increase the transit of Central Asian gas through Russia.

Key to this triumph has been the Uzbek oligarch Alisher Usmanov, chairman of Gazprominvest Holdings. This subsidiary is the channel for massive slush funds. In November 2004, for example, a payment of $88 million to Gulnara, the daughter of President Karimov of Uzbekistan, secured Uzbekistan’s gas contracts for Gazprom from under the noses of the United States, which had originally secured them through a bribe from the subsequebtly defunct Enron. In a series of transactions typical of Gazprom, at the same time Usmanov transferred half of a Russian bank, Mapobank, to Putin’s private secretary, Piotr Jastrzebski. Jastrzebski was Usmanov’s former flatmate at Moscow Diplomatic Academy and bagman for Putin. Putin instructed Karimov in return for the cash to kick out the US military base which dominated Central Asia, and Gazprom had secured the strategic kingpin to dominate the Central Asian and Caucasus gas reserves.

Schroeder and Usmanov have become close through the Nordstream project. Analysts believe this has very much motivated a determined drive by the German Foreign Minister, a Schroeder protege, to persuade the EU to remove sanctions against Uzbekistan imposed following the Andijan massacre in which 700 pro-democracy demonstrators were killed by Karimov’s troops in May 2005. It also appears to explain a waning of German support for the Caucasus pipeline project.

I ask Kuprianov what precisely are the roles of Schroeder and Alisher Usmanov within Gazprom. Again, he is surprisingly candid. ‘Herr Schroeder is Chairman of Nordstream. His role is to use his influence with European governments to persuade them to support the Nordstream project and to remove political difficulties. Alisher Usmanov is not connected to Gazprom, but to a subsidiary, Gazprominvest Holdings. Mr Usmanov’s skills as a financier are well known. He devises vehicles for handling our most difficult and sensitive financial transactions.’

I had known from my own intelligence sources while British Ambassador in Uzbekistan that Usmanov was in charge of Gazprom bribery and slush funds. I had not expected Kuprianov to come so close to saying it straight out.

That leaves only one option to Europe if it wishes to avoid client status. It must drastically reduce its dependence on natural gas, particularly for electricity generation. This is also potentially helpful to reduce carbon emissions. We need to look around to those energy sources in which we are self-sufficient, particularly our winds, our streams, our waves and our tides. We need to increase the effort we put in to developing these renewable energy resources, and do so massively, beyond recognition. And we need to do so in the acceptance that it may be expensive, carry an initial economic cost. It is the cost of our security. Traditionally we have been prepared to pay that cost in armies and weapons. We have to accept that in the coming century energy security must be a major priority, and we must urgently enhance our self-sufficiency.

So Gazprom has now emerged not only as the monopoly supplier to Europe of Russian gas, but of Caspian and Central Asian gas too. Unless Europe reduces its dependency on gas, this represents a massive strategic threat to our security. It is a much more fundamental and credible threat to Europe than Islamic terrorism or North Korean nuclear weapons, but has received massively less publicity. Russia is strutting with a new arrogance on the World stage; let us retain out ability to thumb out nose when we wish.

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7 Comments

  1. peacewisher

    1 Jun, 2007 - 5:59 pm

    Blair should have had good advice on enbergy supplies, and should have taken it.

    Before Britain came to depend on North Sea Gas, we used coal for most of our energy needs. From my understanding, we still have 200 years of KNOWN coal deposites. As the price of oil continues to rise, surely it is time to consider reopening those pits?

    Coal is no worse than oil or gas in terms of glocbal warming.

  2. There are, I believe, ways to burn coal that capture, reduce or convert emissions. How complete an answer that is, I don't know. But certainly it was Thatcher who had the original short sight on this one.

  3. Coal is worse than oil, which in turn is worse than gas, for greenhouse gas emissions. The reason this country is on target to meet its Kyoto commitment to reduce greenhouse gas emissions is "the dash for gas" in the electricity generation sector. (We have done literally bugger all else.)

    Yes, carbon sequestration is potentially possible from burning coal, but so is it from oil or gas. Maybe it's got a role. But I believe we should look to energy efficiency and renewables for both energy security and climate security. If the will was there, we could improve our energy efficiency by loads quite comfortably, and for the remaining power needed we've got plenty of wind, tides every 12 hours, ocean currents, and even sunshine, that can give us wha we need if we try hard enough.

    Meanwhile, as the price of oil & gas rise, we don't reopen pits here, we import more strip-mined coal from Colombia etc for our electricity needs. And we ain't burying the CO2 under the sea right now, we're pumping it out into the atmosphere. Whatever the rights & wrongs of Thatcher -v- Scargill in the 80s, it's not relevant to today's struggle against global warming.

    But, returning to your original theme, yes Blair has been a fool to miss the real security threats to this country, of which creating dependency on today's Russia is clearly one.

  4. And of course the what is going on with the murder of journalists and the end of free speech in Russia is horrific. Though this is obviously Putin's fault, I also think there is an argument that Putin is to an extent the West's fault, in that the market ideologues and carpetbaggers the West sent in in the early 90s helped to destroy that country and we can hardly blame the Russian people for supporting a guy who is kicking us back out. Do you agree?

  5. Strategist,

    I don't like the idea of carbon apture and burial undreground or undersea. Reminds me of the nuclear waste problem.

  6. Please could someone answer the following questions for me?

    1. Why has there been only one islamic terrorist attack in New York (9/11/01) Madrid (11/3/04)and London (7/7/05) respectively?

    2. Why, when we are told that there are 'thousands' of Islamic terrorists in Britain busily plotting away, have they not successfully carried out any other attacks?

    3. Given that this is the case, why are these terrorists so different in this respect from every other terrorist organisation the world has ever known (e.g. the IRA, ETA, the Red Brigades, Baader Meinhof, etc.) who, with far smaller numbers, carried out attack after attack?

    4. How is it that our intelligence services are so successful in thwarting the 'hundreds' of plots that these terrorists have planned, so much so that, apart from the single, successful attack mentioned above, the intelligence services have an unprecedented 100% success rate?

    5. Does this mean that the Islamic in Britain are the most useless, incompetent, and stupid terrorists the world has ever known? And yet manage to tie up our entire intelligence services 24 hours a day?

    Yours puzzled,

    David

  7. massivley significant and important. the new weapon of choice among the superpowers of the 21st Century – gas & oil.

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