Security Watch: December 17, 2002

IRAQ CANCELS RUSSIAN OIL DEALS... Iraq has reportedly canceled a $3.7 billion oil deal with three Russian firms to develop the West Qurna field, Interfax and international media reported on 12 December. "LUKoil, Russia's largest oil group by reserves, was informed this week, along with two minority partners [Zarubezhneft and Mashinoimport] in the project, that their contracts in the second phase of the West Qurna field had been terminated," ft.com reported. A LUKoil spokesman said that an Iraqi deputy oil minister on 9 December sent a letter to LUKoil President Vagit Alekperov informing him that the contract had been canceled. The action reportedly resulted from failure on the part of the Russian companies to develop the field, which has reserves estimated at 7.3 billion barrels. Iraq has repeatedly tried to pressure the Russian firms to begin developing the fields. However, the firms are currently banned from doing so under United Nations sanctions.

...AS LUKOIL VOWS TO TAKE LEGAL RECOURSE... Aleksandr Vasilenko, the head of LUKoil's public-relations office, said his company did not violate its contract with Iraq and will fight the cancellation through international legal channels, NTV and other Russian news agencies reported on 12 December. He said LUKoil's contract with Iraq was passed by Iraq's parliament and "we cannot understand how an official can break it," NTV quoted him as saying. "LUKoil is under the strong protection of the Russian state and hopes that [the Russian state] will do everything necessary to foil this shallow blackmail." LUKoil Vice President Leonid Fedun said his company does not believe the Iraqi decision is irreversible, polit.ru reported. He said the contract states that the sides must apply to an international court if the contract's terms are violated and added that LUKoil believes the contract remains in force until a court rules otherwise.

...AND FOREIGN MINISTRY SLAMS IRAQ OVER CONTRACT... The Russian government expressed bewilderment on 15 December over Iraq's decision to cancel its contract with LUKoil, polit.ru reported. The Foreign Ministry issued a statement saying the decision is "a step that does not correspond to the friendly relations between our two countries." The statement also drew attention to the fact that Baghdad made the decision even as Moscow is expending considerable effort to find a peaceful solution to ongoing dispute between Iraq and the United States.

...AS COMMENTATORS SAY BAGHDAD IS PUSHING MOSCOW TOWARD WASHINGTON. Political analyst Vyacheslav Nikonov, head of the Politika Foundation, said that Iraq has made a serious mistake by "playing hardball" with Russia, polit.ru reported on 15 December. He noted that Russia has been very conservative in its approach to Iraq and it has used its influence to restrain the United States. In doing so, Russia has been counting on the Iraqi leadership's willingness to defend Russia's economic interests. Commenting on the decision, Nikonov said, "This is not the tone with which one speaks to the Russian Federation." TV Tsentr commentator Aleksei Pushkov said on 14 December that the only reason Iraqi President Saddam Hussein is still in Baghdad is because of the political backing of Russia, China, and France. However, Moscow has never concealed that its position is determined largely by its own economic interests. By ignoring those interests, Hussein "has pushed Russia into America's embrace," Pushkov said.

RUSSIAN OFFICIAL CLAIMS IRAN'S CASPIAN STANCE IS CHANGING. Russia's presidential envoy for the Caspian and Deputy Foreign Minister Viktor Kalyuzhnyi told reporters in Moscow on 10 December that, after visiting Iran last week, he believes Tehran is ready to conduct bilateral negotiations with its immediate neighbors (Azerbaijan and Turkmenistan) on use of the Caspian Sea, Interfax reported on 10 December. Moscow has already secured bilateral agreements with Baku and Astana. Kalyuzhnyi said Russia has invited Iran to demarcate the Caspian by resources rather than by a percentage. Iran has consistently demanded an equal 20 percent division among all five littoral states. Kalyuzhnyi said Iran is considering an invitation to participate in developing the Turkmen shelf. Kalyuzhnyi explained this generosity somewhat when he said, "We asked that Iran enter into negotiations on this issue with Turkmenistan, because without Tehran's consent, not a single Russian company would go to work in the Turkmen sector." President Mohammad Khatami told reporters on 4 December that "any decision concerning the Caspian Sea should be made unanimously by all five littoral states."

NATO HEAD SEES 'NO OBSTACLES' TO FURTHER COOPERATION WITH RUSSIA... During a live appearance on RTR television on 10 December, NATO Secretary-General Lord George Robertson said he sees no obstacles to cooperation between the alliance and Russia's military-industrial complex, strana.ru reported. Moscow and Brussels "are working along the entire spectrum of cooperation issues and there are no obstacles," Robertson was quoted as saying. "And this especially includes antimissile defense." He also said that "about 80 percent" of NATO's military bases have been closed down since the end of the Cold War and "all its offensive systems have been withdrawn and most of them dismantled." On 9 December, Robertson met with business leaders in Moscow and urged accelerated military reforms "both in the countries of the alliance and in Russia," RosBalt reported. He said that military reform in Russia could stimulate trade and investment and help the development of small business.

...AS SURVEY PROBES RUSSIAN ATTITUDES TOWARD NATO. A majority of Russians continue to believe that Russia should cooperate more closely with NATO, polit.ru reported, citing a national poll by the Public Opinion Foundation. According to the poll, 56 percent of respondents support closer relations, while 23 percent oppose them. In May, these figures were 62 percent and 20 percent, respectively. In June 1999, 45 percent supported closer ties, while 32 percent opposed them. The latest survey also found that 35 percent of respondents favor Russian membership in the trans-Atlantic alliance, while 41 percent oppose it. Nonetheless, 48 percent of Russians view NATO as "an aggressive military bloc," and just 26 percent see it as "a defensive military bloc." These figures are virtually identical to the results of a similar survey conducted in September 2001. Sixty-nine percent of respondents in the latest poll expressed opposition to the entry into NATO of the Baltic states. The survey found the strongest distrust of NATO among the elderly and the middle-aged. Among those under age 35, 35 percent oppose the entry into NATO of the Baltic states, and 39 percent view the alliance as an "aggressive military bloc."

DUMA TO DISCUSS STRATEGIC-REDUCTIONS TREATY. President Vladimir Putin has submitted to the State Duma for confirmation the Strategic Offensive Reductions Treaty, which he and U.S. President George W. Bush signed in Moscow in May, Interfax and other Russian news agencies reported on 9 December, citing the Kremlin's press office. Parliamentary hearings on the agreement are expected to begin in the near future.

NUCLEAR PLANTS BRACE FOR POSSIBLE TERRORIST ATTACKS... Security has been stepped up at Russia's nuclear-power plants following a recent statement in London by Chechen Vice Premier Akhmed Zakaev that Chechen fighters may be targeting them, newsru.com reported on 9 December. Zakaev had warned in October that Chechen fighters might launch such an attack (see "RFE/RL Newsline," 29 October 2002), while former Atomic Energy Minister Viktor Mikhailov was quoted by "Izvestiya" on 4 December as warning that "if Chechens get involved in nuclear terrorism, Chechnya will be wiped off the map." "It cannot be said that nuclear-power plants are completely able to withstand terrorists," said Rosenergoatom General Director Oleg Saraev. However, "organizational measures and measures taken by security agencies can make [their] actions much more difficult." The website also reported that in late November agents of the Federal Security Service (FSB) arrested a captain in the security detachment at the Kalinin Nuclear-Power Plant in Tver Oblast. According to the report, the suspect was found to be in possession of a classified plan of the facility and coded telephone numbers that turned out to belong to Chechen nationals. Tver Oblast Military Prosecutor Oleg Pribok reportedly confirmed that a criminal case has been filed against the unidentified officer.

...AS GENERAL STAFF ORDERS TROOPS TO BE READY FOR TERRORIST ATTACKS... Chief of the General Staff Anatolii Kvashnin has ordered the commanders of all military units and garrisons to submit contingency plans for the prevention of terrorist attacks, newsru.com reported on 11 December. Analysts see the directive as a result of President Putin's recent decision to modify the country's security doctrine and name terrorism -- rather than NATO -- the primary threat to Russian national security (see "RFE/RL Newsline," 30 October 2002). Meanwhile, Kvashnin, who heads a special commission evaluating the combat readiness of the country's airborne forces, told airborne-forces commander Colonel General Georgii Shpak that he rates the readiness of Shpak's forces as "mediocre," "Izvestiya" reported. Kvashnin has long had an antagonistic relationship with Shpak and has proposed abolishing the airborne forces and creating instead a highly mobile rapid-reaction force capable of combating terrorism.

...AND YAMAL AUTHORITIES SET UP CHECKPOINTS, EXTRA PATROLS. Authorities in Yamal Peninsula, which is home to huge oil and gas deposits, have established a host of new measures to combat potential terrorism and the threat of organized crime, ORT reported on 11 December, quoting the presidential representative to the Urals Federal District, Viktor Pogorelov. The precautions include checkpoints on highways and around key energy installations along with round-the-clock document checks at airports. Meanwhile, the presidential envoy to the district, Petr Latyshev, called the measures insufficient and vowed to demand amendments to the law on terrorism to "provide security and stability to energy-rich regions like Yamal," ORT reported.

GOVERNMENT MUM ON HOSTAGE-CRISIS GAS. The Health Ministry on 10 December refused to answer a parliamentary request from Duma Deputy Sergei Yushenkov (independent) to identify the name of the sleeping gas used by special forces in the 26 October operation to free more than 700 hostages being held by Chechen fighters in a Moscow theater, Russian news agencies reported. In a letter to the Duma, Health Minister Yurii Shevchenko said his ministry cannot release the information because it is a state secret. He argued that all information dealing with intelligence and counterintelligence matters is classified and can only be made public by authorized security agencies.

IMPRISONED CHECHEN FIELD COMMANDER DIES MYSTERIOUSLY... Salman Raduev, one of the most notorious Chechen field commanders, died suddenly on 14 December in a labor camp in Perm Oblast from "internal bleeding of uncertain origin" after a one-week hospitalization, ORT and other Russian news agencies reported. Raduev, 35, was captured in Chechnya by the Federal Security Service (FSB) in 2000 and sentenced to life in prison after being convicted of terrorism, including 1996 raids on Kyzlyar and Pervomaiskoe, during which several dozen civilians were killed (see "RFE/RL Newsline," 28 December 2001). Deputy Justice Minister Yurii Kalinin said an autopsy revealed "no evidence of violence." He added that he does not know the cause of Raduev's "internal bleeding" but speculated that it might have been caused by his numerous combat wounds or by a blood disease from which he reportedly suffered since childhood. An unidentified Justice Ministry official said the fatal illness might have been brought on by Raduev's strict observance of the fast during the month of Ramadan. He also said Raduev's body will not be turned over to his relatives but would be buried in the prison camp's cemetery. Chechen Deputy Prime Minister and National Security Minister Turpal-Ali Atgeriev died in prison in August, reportedly of leukemia, although prior to his conviction he had enjoyed perfect health (see "RFE/RL Newsline," 23 August 2002).

...AS MEDIA SPECULATE THAT HE WAS KILLED. Raduev died as the result of a severe beating, "Kommersant-Daily" wrote on 16 December. According to unidentified sources within the labor camp's administration, Raduev failed to obey a prison warden's command and was severely beaten with a nightstick, dying several hours later. The daily noted that Raduev's death comes shortly after he gave testimony against Chechen Vice Premier Zakaev that was used as part of Russia's unsuccessful case to secure Zakaev's extradition from Denmark. Russia is currently seeking Zakaev's extradition from the United Kingdom, and the loss of such an important witness could seriously hamper Russia's case, as Zakaev's defenders will now argue that the Russian secret services forced Raduev to testify and then killed him to prevent him from changing his story, the daily commented.

REPORT: IS KREMLIN SEEKING TO EDGE OUT CHECHNYA GENERALS? Colonel General Gennadii Troshev, who has been commander of the North Caucasus Military District since 2000, will reportedly be transferred to command of the Siberian Military District, "Nezavisimaya gazeta" reported on 10 December, citing unidentified sources in the Defense Ministry. The paper commented that such a move might signal that the Kremlin wants to edge out those generals that commanded the military operation in Chechnya and who are now seen as obstacles to resolving the conflict there.

U.S., RUSSIAN MILITARY CHIEFS TALK COOPERATION. The chairman of the U.S. Joint Chiefs of Staff, General Richard Meyers, met in Moscow on 11 and 12 December with his counterpart, General Kvashnin, to discuss bilateral cooperation in combating international terrorism and strategic-stability issues, Russian and Western news agencies reported. Meyers also met with Defense Minister Sergei Ivanov to discuss Iraq, the Caucasus, and the antiterrorism operation in Afghanistan. The two also visited the command center of the Russian Space Forces in Solnechnogorsk.

FSB DIRECTOR DETAILS U.S. SPYING IN RUSSIA. Speaking to the heads of Russia's main television channels and news agencies, Nikolai Patrushev said that his agency uncovered a U.S. intelligence operation in 2002 and arrested two Russian citizens on suspicion of gathering secret military information, ORT and other news agencies reported on 16 December. Patrushev said that many representatives of aid and religious organizations are "working for American intelligence," mentioning especially the U.S. Peace Corps. This year, the FSB instigated the refusal to renew the visas of 30 Peace Corps volunteers working in Russia (see "RFE/RL Newsline," 13 August 2002). He added that some Turkish and Azerbaijani organizations and citizens are also conducting intelligence work. He said that an Azerbaijani general who worked on the CIS staff for military cooperation was arrested and expelled earlier this year. At the same time, Patrushev emphasized that the FSB is cooperating closely with Western intelligence services to combat international terrorism and that through this cooperation several internationally wanted Islamic extremists were arrested in Russia in 2002.

TWO CANADIAN DIPLOMATS EXPELLED. The Russian Foreign Ministry on 9 December announced that two Canadian diplomats have been expelled from Russia "for activities incompatible with their diplomatic status," Russian news agencies reported. A spokesman for the Canadian Foreign Ministry said the two men, who were not identified, left Russia on 7 December. He flatly denied the charges of spying. According to Reuters, the move was a tit-for-tat reaction to the expulsion from Canada "a few weeks ago" of two Russian diplomats charged with spying. Ottawa and Moscow on 10 December exchanged statements expressing a commitment to improved relations in the future, ITAR-TASS reported.

AUDIT CHAMBER TO CREATE PERMANENT INSPECTION TEAM FOR CHECHNYA. The Audit Chamber plans to create a unit to monitor continuously how state funds are spent in Chechnya, Audit Chamber Chairman Sergei Stepashin told RTR on 8 December. The chamber recently submitted to the Federal Security Service evidence that some 700 million rubles ($23.3 million) in government funds were misused in Chechnya (see "RFE/RL Newsline," 3 December 2002). Stepashin said that the new Chechen prime minister, Mikhail Babich, had written to him asking the Audit Chamber to thoroughly investigate the allocation of funds intended to rebuild the Chechen economy.

GOVERNMENT TO PUT SLAVNEFT ON THE AUCTION BLOCK... The government has announced that a 75 percent stake in the oil giant Slavneft that is owned by the governments of Russia and Belarus will be sold at auction on 18 December, Russian news agencies reported on 15 December. The starting price for the share package is $1.7 billion, but many brokers expect the final price to be more than $2 billion. According to the Antimonopoly Ministry, 12 bidders have been authorized to participate in the auction, including Russian oil giants Tyumen Oil Company and Sibneft and the state-owned Chinese National Petrochemical Corporation (CNPC).

...AS DUMA TRIES TO CUT THE CHINESE OUT. The State Duma on 15 December adopted a nonbinding resolution calling upon the government to ban the CNPC from participating in the Slavneft auction, nns.ru and other Russian news agencies reported. Lawmakers argued that allowing the CNPC to buy Slavneft will harm Russia's economic interests, as the company might then ship crude oil directly to China, bypassing Russian refineries. Union of Rightist Forces (SPS) leader Boris Nemtsov supported the resolution and said that selling such a vitally important national asset to China would be a political mistake. He added that, although there has been a lot of criticism of fellow SPS leader Anatolii Chubais and his early 1990s privatization campaign, at least Chubais never sold important state assets to foreigners.

GOVERNMENT TO DEREGULATE NATURAL-MONOPOLIES TARIFFS... Addressing a cabinet meeting on 11 December, Prime Minister Kasyanov said the government plans to ease controls on tariffs charged by natural monopolies such as the Railways Ministry, Unified Energy Systems, Gazprom, and Rosenergoatom, strana.ru reported. The government has already created a Federal Energy Commission, which is in charge of determining policies related to energy prices. The cabinet also approved a 20 percent increase in natural-gas prices, a 12-14 percent rise in railroad tariffs, and a 14 percent increase in electricity rates. Kasyanov noted that these increases have been incorporated into the 2003 draft budget.

...AS 2003 BUDGET PASSES THROUGH DUMA. The State Duma on 11 December adopted in its fourth and final reading the 2003 federal budget, Russian news agencies reported. According to strana.ru, 283 deputies voted in favor and 119 opposed the bill. There were no abstentions. Duma Budget Committee Chairman Aleksandr Zhukov (Russian Regions), speaking before the vote, strongly urged legislators to support the budget. The approved budget foresees a GDP of 13.05 trillion rubles ($387 billion), inflation of 10-12 percent, and a ruble-dollar exchange rate of 33.7 to one. The budget predicts a surplus of 72 billion rubles. The bill will now be sent to the Federation Council.

RUSSIA TAKES LARGER STAKE IN EURONEWS. A general assembly of Euronews shareholders on 11 December announced that it has approved the sale of a 16 percent stake in the company to the Russian state broadcasting company VGTRK, ITAR-TASS and other Russian news agencies reported. With the acquisition, Russia -- which previously held just 1.8 percent of the company -- becomes one of the company's largest shareholders, alongside France, Italy, and Spain. Euronews is Europe's most popular all-news channel, and its signal covers Europe, Canada, the Near East, the Middle East, Russia, and the CIS. In 2001, it began Russian-language broadcasts (see "RFE/RL Newsline," 3 October 2001).

TAMBOV STRIKES A BLOW AGAINST TERRORISM. The Tambov municipal Commission on Place-Names has decided to rename several local streets named in honor of "revolutionary terrorists," regnum.ru reported on 10 December. Streets named for French Revolutionary leader Maximilien Robespierre and Bolshevik activists Vladimir Antonov-Ovseenko and Nikolai Kuznetsov will have their prerevolutionary names restored. "After the terrorist acts in Moscow, the residents of these streets demanded the authorities remove the names of the revolutionary terrorists," a commission statement read. The commission's decision must be ratified by the city Duma before it takes effect.

COMMUNISTS CONTINUE ANTI-YELTSIN PUSH. A group of Communist Duma deputies is continuing its efforts to prosecute former President Boris Yeltsin, APN reported on 11 December. On 11 November, the same group attempted to repeal Yeltsin's economic and social benefits (see "RFE/RL Newsline," 12 November 2002). Despite the fact that the law on guarantees to former presidents and their families grants Yeltsin immunity from prosecution, the group -- headed by Anatolii Lukyanov, Aleksandr Kulikov, Yegor Ligachev, and Nina Ostanina -- has reportedly drafted an appeal to Prosecutor-General Ustinov asking him to look into evidence that Yeltsin committed illegal acts during his term in office. According to the report, the deputies allege that Yeltsin acted illegally in preparing and signing the December 1991 Belovezhsk accords that established the CIS and during the October 1993 Supreme Soviet crisis. Moreover, they allege that he attempted to postpone the 1996 presidential election. The deputies are calling on the prosecutor-general to take testimony from an array of officials from that period, including former Prime Minister Viktor Chernomyrdin, former Justice Minister Valentin Kovalev, and former presidential aides Viktor Ilyushin, Sergei Shakhrai, and Georgii Satarov. The Communist deputies will submit the resolution to the full Duma in the near future.