Photo
Smoke billowing from an oil field near Homs, Syria, in February, while government forces were advancing on the city. Credit Agence France-Presse — Getty Images

MOSCOW — The Kremlin is bringing a new weapon to the fight against the Islamic State militant group in Syria, using market-based incentives tied to oil and mining rights to reward private security contractors who secure territory from the militants, Russian news outlets have reported.

So far, only two Russian companies are known to have received contracts under the new policy, according to the reports: Evro Polis, which is set to receive profits from oil and gas wells it seizes from the Islamic State using contract soldiers, and Stroytransgaz, which signed a phosphate mining deal for a site that was under militant control at the time.

The agreements, made with the Syrian government, are seen as incentives for companies affiliated with Russian security contractors, who reportedly employ about 2,500 soldiers in the country, to push the Islamic State, also known as ISIS or ISIL, out of territory near Palmyra, in central Syria.

Most Middle Eastern wars, of course, are suspected of involving some variant of this deal, but it is seldom made as explicit as in the Russian contracts.

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“It’s all very simple,” Ivan P. Konovalov, director of the Center for Strategic Trends Studies, said in a telephone interview of the reported deals, both struck in December but just recently reported. “If a company provides security, then the country getting that service should pay. It doesn’t matter how the payment is made.”

In the petroleum deal, Evro Polis, a corporation formed last summer, will receive a 25 percent share of oil and natural gas produced on territory it captures from the Islamic State, a news site, Fontanka.ru, reported.

The site has a record of accurately reporting on private security companies in Russia, and just this month Washington appeared to corroborate one of its earlier reports by sanctioning a Russian whose activities first came to light in the publication.

Fontanka’s latest article, published last week, detailed how Evro Polis was cooperating with a shadowy Russian private security group called Wagner that the American sanctions suggest has also provided contract soldiers to the war in Ukraine.

The deal is distinct from the common practice of oil majors and other corporations of outsourcing security in hot spots in the Middle East and around the world. Under the contract, the wells are not just to be guarded, but captured first, the article said.

“The arrangement returns to the times of Francis Drake and Cecil Rhodes,” it noted.

Evro Polis, according to Fontanka and public company records in Russia, belongs to an network of companies owned by Evgeniy Prigozhin, a St. Petersburg businessman close to President Vladimir V. Putin and known as “the Kremlin’s chef” for his exclusive catering contracts with the presidential administration. His company, Concord Catering, also supplies food to many of Moscow’s public schools, according to Russian news reports.

Journalists have reported that Mr. Prigozhin has engaged in another of Russia’s recent experiments in restoring its influence abroad, while keeping costs down: He set up a factory of so-called internet trolls in St. Petersburg, a place packed with lowly paid people posting online under various assumed identities to influence public opinion in foreign countries, including the United States.

Earlier this month, the United States Treasury Department sanctioned Dmitri Utkin, the founder of Wagner, the private security group the report said would capture the Syrian oil and gas wells for Evro Polis. Fontanka first linked Mr. Utkin to Wagner in an article in 2015.

In the other deal, the Russian energy company Stroytransgaz won rights to mine phosphate in central Syria under the condition it secure the mine site, another Russian news outlet, RBC, reported.

Stroytransgaz, which is majority owned by another Russian sanctioned by the United States, Gennady Timchenko, signed a deal with the Syrian government to resume mining at the Sharqiyah phosphate deposit, which was under Islamic State control at the time of signing, RBC reported. Under the agreement, an unnamed Russian private military contractor would guard the site.

However, in this instance Russian, Iranian and Syrian army soldiers rather than private contractors conducted the operations in May that expelled Islamic State militants from the mining site, RBC reported.

In anticipation of the commercial payoff, however, the report said, a Russian ship laden with mining equipment docked at the Syrian port city of Tartus, where Russia has a naval base, even before the military operation began.

Russian officials have not commented publicly on either deal.

The Russian Ministry of Energy did not respond to written questions about the reported oil and gas deal. The owner of Evro Polis did not reply to an email listed on company records.

Asked on a conference call with journalists about the Syrian oil deal, President Putin’s press secretary, Dmitri S. Peskov, said that “we do not monitor some entrepreneurial activity” of Russian companies abroad.

Mr. Konovalov, the military analyst, said the Syrian government was more than willing to strike such deals, trading natural resources for security.

“They get the better side of this contract,” he said. “They get our participation in the security sector in Syria, which is very valuable.”

The Fontanka report suggested that Russian security contractors have already been putting the agreement to work, fighting to expel the Islamic State from natural gas fields near Palmyra.

The Russians are training and fighting alongside a unit of the Syrian army called ISIS Hunters, whose exploits are widely promoted in the Russian state news media. The Fontanka report linked to a video filmed from a body camera worn by a Russian-speaking soldier with ISIS Hunters during a firefight in the desert.

“Friendly, don’t shoot!” the soldier yells in Russian, apparently to other Russian soldiers nearby.

Continue reading the main story

MOSCOW — The Kremlin is bringing a new weapon to the fight against the Islamic State militant group in Syria, using market-based incentives tied to oil and mining rights to reward private security contractors who secure territory from the militants, Russian news outlets have reported.

So far, only two Russian companies are known to have received contracts under the new policy, according to the reports: Evro Polis, which is set to receive profits from oil and gas wells it seizes from the Islamic State using contract soldiers, and Stroytransgaz, which signed a phosphate mining deal for a site that was under militant control at the time.

The agreements, made with the Syrian government, are seen as incentives for companies affiliated with Russian security contractors, who reportedly employ about 2,500 soldiers in the country, to push the Islamic State, also known as ISIS or ISIL, out of territory near Palmyra, in central Syria.

Most Middle Eastern wars, of course, are suspected of involving some variant of this deal, but it is seldom made as explicit as in the Russian contracts.

“It’s all very simple,” Ivan P. Konovalov, director of the Center for Strategic Trends Studies, said in a telephone interview of the reported deals, both struck in December but just recently reported. “If a company provides security, then the country getting that service should pay. It doesn’t matter how the payment is made.”

In the petroleum deal, Evro Polis, a corporation formed last summer, will receive a 25 percent share of oil and natural gas produced on territory it captures from the Islamic State, a news site, Fontanka.ru, reported.

The site has a record of accurately reporting on private security companies in Russia, and just this month Washington appeared to corroborate one of its earlier reports by sanctioning a Russian whose activities first came to light in the publication.

Fontanka’s latest article, published last week, detailed how Evro Polis was cooperating with a shadowy Russian private security group called Wagner that the American sanctions suggest has also provided contract soldiers to the war in Ukraine.

The deal is distinct from the common practice of oil majors and other corporations of outsourcing security in hot spots in the Middle East and around the world. Under the contract, the wells are not just to be guarded, but captured first, the article said.

“The arrangement returns to the times of Francis Drake and Cecil Rhodes,” it noted.

Evro Polis, according to Fontanka and public company records in Russia, belongs to an network of companies owned by Evgeniy Prigozhin, a St. Petersburg businessman close to President Vladimir V. Putin and known as “the Kremlin’s chef” for his exclusive catering contracts with the presidential administration. His company, Concord Catering, also supplies food to many of Moscow’s public schools, according to Russian news reports.

Journalists have reported that Mr. Prigozhin has engaged in another of Russia’s recent experiments in restoring its influence abroad, while keeping costs down: He set up a factory of so-called internet trolls in St. Petersburg, a place packed with lowly paid people posting online under various assumed identities to influence public opinion in foreign countries, including the United States.

Earlier this month, the United States Treasury Department sanctioned Dmitri Utkin, the founder of Wagner, the private security group the report said would capture the Syrian oil and gas wells for Evro Polis. Fontanka first linked Mr. Utkin to Wagner in an article in 2015.

In the other deal, the Russian energy company Stroytransgaz won rights to mine phosphate in central Syria under the condition it secure the mine site, another Russian news outlet, RBC, reported.

Stroytransgaz, which is majority owned by another Russian sanctioned by the United States, Gennady Timchenko, signed a deal with the Syrian government to resume mining at the Sharqiyah phosphate deposit, which was under Islamic State control at the time of signing, RBC reported. Under the agreement, an unnamed Russian private military contractor would guard the site.

However, in this instance Russian, Iranian and Syrian army soldiers rather than private contractors conducted the operations in May that expelled Islamic State militants from the mining site, RBC reported.

In anticipation of the commercial payoff, however, the report said, a Russian ship laden with mining equipment docked at the Syrian port city of Tartus, where Russia has a naval base, even before the military operation began.

Russian officials have not commented publicly on either deal.

The Russian Ministry of Energy did not respond to written questions about the reported oil and gas deal. The owner of Evro Polis did not reply to an email listed on company records.

Asked on a conference call with journalists about the Syrian oil deal, President Putin’s press secretary, Dmitri S. Peskov, said that “we do not monitor some entrepreneurial activity” of Russian companies abroad.

Mr. Konovalov, the military analyst, said the Syrian government was more than willing to strike such deals, trading natural resources for security.

“They get the better side of this contract,” he said. “They get our participation in the security sector in Syria, which is very valuable.”

The Fontanka report suggested that Russian security contractors have already been putting the agreement to work, fighting to expel the Islamic State from natural gas fields near Palmyra.

The Russians are training and fighting alongside a unit of the Syrian army called ISIS Hunters, whose exploits are widely promoted in the Russian state news media. The Fontanka report linked to a video filmed from a body camera worn by a Russian-speaking soldier with ISIS Hunters during a firefight in the desert.

“Friendly, don’t shoot!” the soldier yells in Russian, apparently to other Russian soldiers nearby.

Nytimes

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