By the Blouin News Politics staff

Russia’s corporate armies may be on the way back

by in Europe.

A Gazprom security man stands guard behind a fence at a drilling platform at an oilfield near the Iraqi city of Badra, south of Baghdad, on October 18, 2012. The company, which won the tender to develop oil project in Badra in 2009, will invest two billion dollars to develop the oil field, and expects to be pumping the first shipment of crude oil within three years.

A Gazprom security man. AHMAD AL-RUBAYE/AFP/Getty Images

Russia’s lower house, the State Duma, has passed in the first reading a bill that allows state energy corporations Gazprom and Transneft to maintain extensive armed security forces. This reflects a steady rollback of previous efforts to cut down on the proliferation of private security forces in Russia but may also reflect an interest in moving into the global private military services industry.

The 1990s saw a massive expansion in the private security sector as well as the emergence of virtual corporate armies. However, since Vladimir Putin’s rise to power, there has been a steady campaign to consolidate and control the non-state security sector. The private security industry, which is worth over $7 billion a year, has far fewer rights to use lethal weapons, while corporate protection services are similarly limited.

The energy sector, it should be noted, has traditionally had greater leeway, reflecting both its power within the political system and also its need to secure facilities and pipelines which are often remote and sometimes in volatile regions. In 2007, both companies were again allowed to issue lethal weapons to their security personnel. However, Draft Law 244239-6 “On Amendments To Some Legislative Acts Of The Russian Federation On The Establishment Of Departmental Security To Ensure The Safety Of The Fuel And Energy Complex,” will free them of further constraints, including on the scale and use of lethal weaponry.

This follows a pattern of a gradual return to the militarization of the economy. In 2011, Putin indicated that his government might reverse its previous policy and support the creation of Russian private military companies — mercenary organizations — as “a way of implementing national interests without the direct involvement of the state.”

This underlines the Kremlin’s belief that expanding the Russian private security industry is not first and foremost a reflection of legitimate market needs but a tool of statecraft. Gazprom and Transneft already operate in volatile regions — including the North Caucasus, where until now the Chechen government has maintained its own “Oil Regiment” to protect pipelines. However, allowing them to build their own armed security forces will not only reduce the burden on state security forces. It also paves the way towards the creation of private military contractors, since even in 2011 it was understood that these would probably be created on the basis of the security arms of state and semi-private energy companies. This may therefore be the first step in Russia’s entry into the military contractor market for “kinetic solutions” to the world’s problems.