Feral Jundi

Wednesday, July 5, 2017

Industry Talk: Offense Industry In Syria?


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

“The arrangement returns to the times of Francis Drake and Cecil Rhodes,” it noted, referring to two figures from British history whose careers mixed warfare and private profit.-NYT

A couple years back, I came up with a concept that more accurately described the type of contracts PMSC’s were conducting in the war. Current contracts are more or less classified as ‘Defense Industry’, where companies profit from the defense of a client and their property. This kind of contract is more favorable because it is not geared towards destroying the enemy. You actually want the enemy to stick around so you don’t work yourself out of a job. lol

The second type of scheme is ‘Offense Industry’. Basically we are talking about contracts where a company profits from the destruction of a client’s enemy and their property. If XYZ company destroys ISIS, then they are payed 50 billion dollars for example. In my post about it, I brought up past examples of offense industry–like privateering.

Fast forward to today’s news coming out of Syria. According to the news site Fontanka, there is an offense industry contract that has been arranged between Syria and several Russian PMSC’s. Here is the quote from the NYT’s article on it:

So far, 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 are suspected of having 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 by telephone of the deals, 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, the news site Fontanka.ru reported.

This contract is not just about defending a client’s asset. This first requires these companies to conduct offensive operations and seize this territory, and then defend it! That is a big difference and greatly adds to the risk of these types of contracts. But there is a big reward if they can take it.

It is that reward mechanism that creates an incentive for an investor to put so much into something like this. It is why investors put so much money into privateering vessels during the Revolutionary War and War of 1812 in the US–they were ‘incentivized’. But they also had a legal contract with the backing of the US Constitution and congress in the form of a Letter of Marque. I have not seen such legal protections talked about in this article by the NYT or Fontanka. Although I have to imagine the backroom dealings on this would be pretty comprehensive.

A final thought on this is that I held back on putting this story up at first. I do not have the resources to go to Syria and confirm all of this. So these forces might be legitimate Russian PMSC’s, or they might be just Russian special operations dressed up to be PMSC’s (little green men anyone?). I have written about PMC Wagner in the past, as well as the Slovanic Corps and the story always seems to be a little different that what was reported. There are a lot of groups out there pushing agendas and trying to trade up the chain as they say. So are we seeing the beginnings of new offense industry in Syria? We will see where this goes…. –Matt

 

Russian EOD personnel in Palmyra, Syria. -NBC

Russia Deploys a Potent Weapon in Syria: The Profit Motive
By ANDREW E. KRAMER
JULY 5, 2017
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 extremists, Russian news outlets have reported.
So far, 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 are suspected of having 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 by telephone of the deals, 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, the news site Fontanka.ru reported.
The website has a record of accurately reporting about private security companies in Russia, and just last month Washington appeared to corroborate one of its earlier reports by imposing sanctions on a Russian whose activities first came to light in the publication.
Fontanka’s latest article on the topic, published last week, detailed how Evro Polis was cooperating with a shadowy Russian private security group called Wagner, which 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 outsourcing security in hot spots in the Middle East and elsewhere. Under the contract, the wells are not just to be guarded, but to be captured first, the article said.

(more…)

Monday, October 17, 2016

Strategy: The Future Of War, By Sean McFate

I really liked this presentation because it brings in all of the elements that I have been talking about on this blog, into a nice format that Dr. Sean McFate has put together. It is definitely worth your time to watch and absorb.

The thing that stood out to me was the discussion of the strategic uses of private forces or PMSC’s. He presents the case that A. the industry is not going away B. we are reverting back to a pre-westphalian era, and C. that the west might not want to use PMSC’s for waging war, but other countries like China or Russia have no issue with them.

It is that dynamic that is interesting to me. That countries are slowly going towards the use of PMSC’s to wage war, and they are doing it as a part of their national interest. Russia for example used their little green men hybrid warfare strategy in the Ukraine. Iran uses mercenaries in Syria. And then there is China and their use of maritime militias. Even with the west, contractors have been used in Iraq and Afghanistan as a way to supplement manpower shortages in this wars. The common theme here is that private forces are used as a part of a larger ‘strategy’, and this presentation challenges those who are closed minded or unaware of those uses. It forces the viewer to think about how PMSC’s are used, or could be used, strategically.

In the past, I have discussed all sorts of interesting ways that private forces have been used for the sake of national interest. The very first overseas land operation of the US was the Battle of Derna (Shores of Tripoli from the Marine Hymn) in Libya, where a small contingent of Marines/Army commanded several hundred Christian and Islamic mercenaries to fight in the First Barbary War. The early privateers that the US used in the Revolutionary War and War of 1812 were another example of the use of PMSC’s as a part of a larger strategy to support national interest. The Flying Tigers was another example of modern aviation PMSC’s, or Britain’s Watchguard International Lmtd. in Yemen, or even recently with STTEP in Nigeria. Private forces can be used to great effect, and there are historical cases that make this point.

Sean covers a broad scope of ideas, and they are provocative to the say the least. What I wanted to post was the ten ideas of this future war he describes. Bear in mind, he is mostly referencing what is going on right now, and trying to envision where this goes with each point.

1. There will never be ‘symmetry’.

2. Technology won’t save us.

3. States matter less.

4. Warriors are masked and may not fight for states.

5. Laws of war and international law don’t apply.

6. There will be a market for force with mercenaries.

7. Others will wage war and new kinds of superpowers will emerge.

8. Plausible deniability is power.

9. Hearts and minds matter very little.

10. There will be more war.

I won’t ruin the whole thing for the reader, but I did want to comment on one deal he brought up that is not discussed a lot out there. He mentioned ‘hack back‘ companies, or basically cyber companies contracted to attack hackers or countries that used hackers to attack those companies. To me, this is pure cyber privateering, and we are getting close to the concept of state sanctioned hacking as this becomes more of a problem. I am reminded of the attack on Sony, and how brutal that was. Or worse, hacks on nuclear facilities…. In the past I have talked about how the Letter of Marque could be used for this as a means of keeping it in check. As more companies or countries get attacked by hackers who are sponsored by states, the idea of attacking back becomes more and more a thing to consider. For a further exploration of cyber privateering, I suggest the Morgan Doctrine blog. Interesting stuff and check it out below. If you are interested in further exploring this topic, I highly recommend Sean’s book called The Modern Mercenary: Private Armies and What They Mean for World Order. –Matt

 

The future of war points.

A screen shot of the future of war points.

 

 

Wednesday, January 9, 2013

Maritime Security: Typhon–Yet Another Bid At A Private Navy

What better way to start the new year off than with a post about another private navy? lol The last couple of years, I have been posting about the Jardine Lloyd Thompson CEP ‘private navy’. With that venture, they made a lot of promotional announcements, but never got it off the ground.  Funding of such a thing is the problem, and we will see how this new private navy venture by Typhon does in their drive to get set up.

So lets look at the business model, as was stated by Typhon in January of last year.

“A huge difference between our model and others is that we will negotiate reduced insurance rates. Rates have skyrocketed because it’s costing the industry $10bn-$12bn a year when you add everything up. Ransoms alone are $800m-$1.2bn.”
South Korea reportedly paid $25m to reclaim a ship last year. “And then that’s the new bar. It throws out Lloyds’ actuarial valuations,” says Sharp. “You have no idea what to charge as a premium. For my clients, we can take out some of the risk. I’ve got a letter from a Lloyds broker saying we can offer a 50pc discount on rates. That more than caters for our services.”

You know, in fairness to potential clients, the company should post that letter from Lloyds on their website. Matter of fact, they should do a lot of things with their website in order to spell out exactly what they are all about because it is ‘vacant’.

Furthermore, when a company puts it out there that it is recruiting 240 former Royal Marines, you kind of think there would be some talk of that within the industry? I haven’t heard anything about it, nor is there any lively talk about it over at Close Protection World. I would also like to see this recruitment advertisement or maybe even a recruitment career page on their website, but there is nothing.

I do know that their website is registered in the UAE and supposedly they are based in Abu Dhabi. I do know that they made a promotional video for the company and concept, and you can watch that over at the gCaptain’s website here.

According to the article last year, they have brought on some interesting folks to run this navy. Here is the list.

The ribs will be manned by ex-Royal Marines, as will the group’s base in Abu Dhabi. Murray, a former French Foreign Legionnaire, will be Typhon’s chairman, with Lord Dannatt a non-executive. They will be joined by non-executives including General Sir Jack Deverell, former commander of Allied Forces Northern Europe; Admiral Harry Ulrich, ex-head of US naval forces in Europe; and Peter Ahlas, former chief of HSBC’s marine and insurance business. It’s quite a roll-call for a company that’s just completing its first fund-raising, of just $15m, and has yet to put to sea.

On a side note, Simon Murray has an interesting background. He did a stint in the French Foreign Legion. He is also a power broker and wealthy enough to make a project like this work. He is also partnered up with a non-military guy who I guess was the one that came up with the idea of Typhon. Here is the quote.

But Sharp himself is new to the all-action side of things. His career has seen him invest in start-up travel ventures from lastminute.com to GoAmerica, take AIM minnow Cashbox public, and launch Earthshine, a commodities distributor.
“I had the idea for Typhon playing polo one afternoon, thinking about what my next business might be,” says Sharp. “I picked on maritime security. Two years later we’re completing our funding round, acquiring our first vessel in weeks, and hope to be in theatre shortly after.”

It is always funny to me when you hear about the inception of an idea, like with Sharp’s statement of ‘while playing polo one afternoon, thinking about what my next business might be…’ lol  Polo or golf, it seems like a lot of ideas for businesses get their start during play.

No mention of a Letter of Marque being issued either. Here is what was mentioned, and it would be cool to hear more about the legal side of this private navy.

The Britons intend to sail under a sovereign flag which will give them the legal right to carry their weaponry into harbour, rather than cache them on platforms in international waters.

Interesting stuff and I wish the company luck in their goal of firing up a private navy. –Matt

 

Glencore chief Simon Murray launches private navy to combat Somali pirate threat
By NICHOLAS HELLEN
January 06, 2013

BRITAIN’S first private navy in almost two centuries is being created by a group of businessmen to take on the Somali pirates who are terrorising an expanse of the Indian Ocean.
Its armed vessels – including a 10,000-ton mother ship and high-speed armoured patrol boats – will be led by a former Royal Navy commodore. He is recruiting 240 former marines and other sailors for the force.
It will escort its first convoy of oil tankers, bulk carriers – and possibly an occasional yacht – along the east coast of Africa in late March or April.
Typhon, the company behind the venture, is chaired by Simon Murray, a millionaire businessman who joined the French Foreign Legion as a teenager and walked unsupported to the South Pole aged 63.
Typhon has been set up because the Royal Navy, NATO and the European Union Naval Force lack the vessels to patrol an area of ocean that is as large as North America, said Anthony Sharp, chief executive. “They can’t do the job because they haven’t got the budget and deploying a billion-pound warship against six guys [pirates] with $500 of kit is not a very good use of the asset,” he said.

(more…)

Sunday, December 2, 2012

Maritime Security: Piracy Plunges As More Ships Start Carrying Armed Guards

“In 2011, the numbers of private armed security teams went up significantly and that has been a big game-changer as well, though not the only factor,” Olive said. “If that pressure is taken off it can all start to be unpicked relatively rapidly,” he added, referring to industry and military measures to combat piracy.

It’s nice to see some recognition going towards the efforts of armed security out there. They have been a ‘big game-changer’ and the statistics speak for themselves.

Although one looming iceberg that can really mangle the record of private armed guards are shootings that result in innocent people being killed. I have to imagine that we will see private maritime security industry involved in such a thing, and an example of how that might turn out can be seen with the shooting accident that happened last February between some Italian Marine vessel protection guards and an Indian fishing vessel.

In that accident, one innocent person was killed, and it is the type of deal that has been all over the news in both India and Italy. This kind of international incident would literally destroy a security company and absolutely embarrass the client. But it would also be the kind of incident that would put some extreme negative attention on the maritime security industry as a whole. The question is how do you prevent something like that from happening, and can you?

Logically speaking, it is bound to happen. So the prudent thing for companies is to actually prepare your legal strategic defense for such an event. To study how this specific event between the Italians and Indians, and learn from it to get a good game plan together. Of course you always want to refine your rules of engagement and enforce it with training and good management/leadership, but in the realm of combat, unfortunate things happen and companies must be prepared.

One final point is the use of the Letter of Marque (LoM) or a similar licensing system. This could be used as a form of protection for those armed guards on the high seas. If the ship’s captain carries a LoM for that vessel, issued by the same state the vessel is flagged under, then in that case the state can identify through that license what they are legally willing to support when it comes to the defense of that vessel. Under the terms of the LoM, you can list all sorts of requirements of the vessel’s protection team, and you can write up legal protections for that team and vessel.

The main point of this type of LoM is to get the state back into the game of regulating armed force on these vessels and provide some kind of legal protections and accountability. If states are willing to put their flag on a vessel, then why not go the whole way and allow them to issue a LoM or similar license for this kind of ‘warfare on the high seas’? –Matt

 

Piracy plunges as more ships start carrying armed guards
November 30, 2012
By Michelle Wiese Bockmann
Pirate attacks on merchant vessels in the Gulf of Aden and the Indian Ocean fell 81 per cent this year as the use of armed security guards on ships acted as a “game-changer,” according to the European Union’s naval force.
There were 34 attacks by Somali pirates, with five vessels hijacked so far in 2012, compared to a record 176 assaults in the whole of last year that resulted in 25 ships seized for ransom, according to Peter Olive, the EU Naval Force’s chief of staff.
Ransom payments to Somali pirates totaled $36 million so far this year, compared with $147 million last year, he said Thursday at a briefing at the EU’s naval force headquarters at Northwood, England. As well as more aggressive military operations, the increasing deployment of private guards over the last 18 months on vessels transiting high-risk areas contributed to the declines, Olive said.
“In 2011, the numbers of private armed security teams went up significantly and that has been a big game-changer as well, though not the only factor,” Olive said. “If that pressure is taken off it can all start to be unpicked relatively rapidly,” he added, referring to industry and military measures to combat piracy.

(more…)

Monday, August 20, 2012

Games: Army Of Two– The Devil’s Cartel

This is a great concept for a game. Take these two security contractors and veterans of the middle east, and put them up against the cartels down south. Here is a quick description about the game.

You’ll face off against the world’s most vicious drug cartel in Army of TWO The Devil’s Cartel. Take part in a private military operation against The Scythe, a wide-spread criminal operation that has brought murderous terror to the besieged nation of Mexico. Lead your own insurrection as you battle tenacious foot soldiers and ruthless drug lords in a story that’s ripped from today’s headlines. Do whatever it takes to end the corrupt cartel’s stranglehold over the country, and bring the head of The Scythe to swift and bloody justice. The Army of TWO may be vastly outnumbered by the villainous Devil’s Cartel, but they certainly will not be outgunned.

Man, it almost seems like the guys at EA are reading this blog. lol I have been talking about private industry, armed with letters of marque, operating within a well constructed offense industry, and used against the cartels for awhile now.

What is cool here is that this game further demonizes the cartels and allows the gaming public to participate in their destruction.  It also brings up the concept of using private industry to take care of a problem. Even if the reality of doing such a thing is remote, or that private industry would probably approach it in a less dramatic and violent fashion, it is the idea of such an action that is significant. Very cool and we will see how it sells. –Matt

Facebook page for game here.

Website for game here.

 

 

Older Posts »

Powered by WordPress