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Mackenzie Institute | 23Mar2014 | Myroslav Petriw , , 
The Empire Strikes Back -
Of History and Hydrocarbons
There remains much confusion and ambiguity about Russia among the
political elite of most western countries. They still do not quite
realize that the Russian Federation is not a nation-state like most of
Europe’s larger countries. Russia is an Empire as it always has been.
citizens’ sense of self, their sense of pride and belonging is tied to
a mythology of imperial grandeur, expansion and plunder. It was at one
time the home of 85 distinct languages and dialects. Many have since
disappeared. Where a nation-state is like an organ, an empire is a
tumor. It exists to expand and it consumes as it expands. It continues
this process provided it has a steady and sufficient blood supply. In
the case of today’s Russian Federation that blood supply is the revenue
it collects on its sale of oil and natural gas.
It was Winston
Churchill who once famously described Russia saying, “I cannot forecast
to you the action of Russia. It is a riddle, wrapped in a mystery,
inside an enigma; but perhaps there is a key. That key is Russian
national interest.”  It is worth noting that Winston’s predecessor
of the previous century, Benjamin Disraeli, suffered no such
confusion. Back in 1876, Prime Minister Benjamin Disraeli -- in a
letter to Queen Victoria, proposed “to clear Central Asia of Muscovites
and drive them into the Caspian .” He did not call them Russians. He
knew his opponents for who they were. Even though the Czars demanded,
ever since the early 18th century, that their empire be renamed as the
Rossian Empire, politicians and cartographers alike continued to use
the historical term Muscovy. A look at today’s Russian Federation shows
it to be, despite a series of regime changes and name changes, a
geographical and political continuation or agglomeration of that
multiethnic empire that Batu Khan, grandson of Genghis, had created.
For five hundred years that empire was known as Muscovy. It was even
referred to as Tartary. This heritage bore little respect among the
aristocratic circles of 17th century Europe. And so after gaining full
control over the lands of the actual historic Rus’, the Ukrainian lands
around Kyiv in 1721, Czar Peter the Great renamed his Czardom of
Muscovy as the Rossian Empire from the word Rossia, the Greek name for
Rus’. This was a transparent attempt to appropriate the legacy of
ancient Rus’. Similarly the legend of the “Third Rome” was also
employed to gain traction among Europe’s elite. Today however, the land
and the people of the actual Rus’ are again outside the borders of this
Strange as it may seem, much of the political elite of
this empire still feels a phantom limb pain for this missing land.
Certainly the reassembling of the Rossian Empire has been an oft-stated
goal of Vladimir Putin. It was on 24 April 2005 that Putin told his
country that the collapse of the Soviet empire “was the greatest
geopolitical catastrophe of the century” . He left no doubt that he
intended to right that wrong .
Even as the USSR was
collapsing, the time bombs and landmines that would help in future
efforts to reassemble it were being laid. These were the “frozen
conflicts” of Transdnistria, South Ossetia, Abkhazia, and
Nagorno-Karabakh; and the direct basing of Russian forces on the
territory of nominally independent states, such as Ukraine, Tajikistan
or Armenia. This put Russian forces in place to simplify the messy
problem of actual invasion when the time came. It can be argued that
the nuclear disarmament of Ukraine under the guarantee of the Budapest
Memorandum was just another such careful preparation for the
reassembling of empire.
Vladimir Putin took it upon himself to
collect the wayward colonies of the empire. First he centralized state
power at home via his construction of a “vertical of power”, and
protected it by “managed democracy”. Then he solved his own “frozen
conflict” in Chechnya by allowing Chechen to fight against Chechen
rather than involving his own GRU troops. After the Beslan siege was
winding down, Putin found that he needed to turn his attention to
Ukraine. A pro-Western presidential candidate was leading in the
polls. I will not detail here the Kremlin’s meddling in that election.
The end result was the Orange Revolution in Ukraine and the coming to
power of the pro-Western Victor Yushchenko. Putin knew he had to
quickly rein in this wayward satellite.
Just as Maxim Litvinov,
the Soviet Commissar of Foreign Affairs declared in 1933 that “Food is
a weapon ”. Vladimir Putin realized that with respect to
Rus’-Ukraine, Natural Gas could also be a weapon. It was on 1 Jan 2006
that he first cut off gas from Ukraine. The effectiveness of this was
hampered by the fact that such actions affected Western Europe too, and
thus the inflow of revenue to Gazprom/Russia. For the natural gas
weapon to work he had to isolate Ukraine. To do that he had to build
bypass pipelines around Ukraine.
The first Ukraine bypass
pipeline was Nord Stream laid along the bottom of the Baltic Sea all
the way to Germany. Putin even had former Chancellor of Germany,
Gerhard Schroder, agree to be chairman of the project  . The
second pipeline project is South Stream, a pipeline that would
transport natural gas from the Yamal deposit by the Arctic Sea, south
to the east shore of the Black Sea, then under the sea bypassing
Ukrainian territorial waters, to Varna in Bulgaria. This project, which
is far from complete, is now estimated to cost $77B. This expenditure
is on top of the vanity expenditure of $50B for the Sochi Winter
Olympics. It should be noted that since Ukraine’s existing pipeline
system is more than adequate for any projected European requirements,
these are expenses that will not generate a single dollar of additional
revenue. They are purely political projects that cannot be justified by
either economics or common sense. It is not surprising that Russia is
now sliding into a recession .
But what has derailed the
Putin plan completely is his underestimation of the shale gas
revolution. Laughably, as recently as 2010 Gazprom was anticipating
supplying LNG to the US ; what totally destroyed the plan was the
discovery of shale gas in Ukraine . Ukraine is facing a future
of natural gas self-sufficiency, if not that of a net supplier. This
calculation explains why, although the EU Association Agreement
overtures of a pro-Western, democratic reform President Yushchenko were
rejected in November 2005 ; the autocratic boorish thug of a
President, Yanukovych presiding over a country that was broke, was
enthusiastically invited to the EU table in the summer of 2013. It more
than explains the panicked reaction of Putin when he realized that
Russia’s influence over Ukraine would vanish, as would all hopes of its
reincorporation into the empire. The pressure Putin put on President
Yanukovych was relentless and by some reports, physically personal.
Eventually the Yanukovych regime relented and accepted a loan promise
from Russia in place of signing the Association Agreement with the
For another 10 weeks, despite all the protest
activity on the Maidan, Kyiv’s city square, Putin was satisfied that
Ukraine was still in Russia’s orbit. Then late on 21 February 2014
Yanukovych abandoned his post. He went AWOL and eventually showed up in
Russia. Within days he was formally impeached by the Ukrainian
Verkhovna Rada (Parliament) and a search warrant was issued. As the
curtain closed on the Sochi Winter Olympics on 23 February 2014, Putin
realised that he had bet the farm on his bypass pipelines, and lost.
Ukraine was going to align herself with Western Europe and wean herself
off Russian gas. Like the gambler in a Hollywood Western that realizes
that he overplayed his hand, Vladimir Putin kicked over the card table
and drew his gun. As the last visitors to the Olympics were filing
through the airport gates, the Russian military began to roll its APC’s
beyond the confines of their Sevastopol base to begin the occupation of
Ukraine’s Crimean peninsula.
Russia’s military occupation of Ukraine’s Crimean peninsula:
was 26 February 2014 that Russian military vehicles were seen on
Crimean roads. Roadblocks were being set up by the Russian military,
presumed to be from the existing multiple bases of the Black Sea Fleet.
Thousands of ethnic Russian demonstrators protesting the change of
government in Kyiv clashed with Crimean Tatars who supported the
democratic revolution. Ethnic Russians were forming so-called
“Self-Defence” units. In Russia’s Western region on the northern
borders of Ukraine, Putin ordered massive military exercises of air and
ground forces . Despite that, very few western pundits were
informed enough to have predicted the Russian invasion that commenced
the very next day .
On 27 February 2014 about 150
unidentified soldiers and four Kamaz heavy trucks arrived at the
Simferopol Airport. A small crowd of about 25 civilians stood nearby
holding a flag of the Russian Black Sea Fleet. No explanation of their
presence was forthcoming . At the Simferopol Verkhovna Rada
(Parliament) about 120 heavily armed men stormed the building,
occupying it . While it was occupied by the gunmen, the Verkhovna
Rada of Crimea dismissed the current presidium and installed a new
Chairman of the Council, Sergey Aksyonov, aka “Goblin”, a leader of the
Russian Unity party and a known gangster and racketeer . They also
voted to hold a referendum on expanding the rights of the Autonomy of
Crimea on 25 May 2014. Since then, on 6 March 2014, this was changed to
a referendum on joining the Russian Federation with the vote reset to
16 March 2014.
That same day two large assault vessels (invasion
landing ships), the Kaliningrad and the Minsk of Russia’s Baltic fleet,
were observed passing through the Bosphorus . That day, the
Ukrainian flagship, the frigate Hetman Sahaidachnyy, just completed the
joint anti-piracy exercises “EU Navfor Atalanta” with the EU in the
Aegean Sea . It was then to return to Ukraine.
February 2014, Russian helicopters were seen heading to Belbek, the
Sebastopol airport. That same day thirteen enormous Russian IL76
transport aircraft were reported to have landed at this Sevastopol
airport . Five more were reported to have landed at Gvardiysky
airport near Simferopol. Ten BTR’s (APCs) were also seen, heading in
the direction of the capital of Crimea, Simferopol. In Belbek all air
traffic was halted. About 400 individuals had blocked that airport
runway. A flight of ten helicopters was reported to be flying in from
the Kerch peninsula in the east .
By 2 March 2014 Russian
soldiers had occupied most of Crimea. Estimates ranged up to 30,000
troops on the ground. It is noteworthy that all of them were equipped
with the very latest gear and equipment, but they wore neither insignia
nor any identifying markings. That day the Ukrainian garrison in Kerch
was surrounded by Russian troops. The ferries that run across the Kerch
Straits had also been seized for use by the Russian military. Among
such passengers over the next days would be an entire Russian biker
It is noteworthy that the Ukrainian military adopted the
tactic of passive resistance with no firearms. They often faced armed
Russians nose to nose but were not giving up their bases. One can
speculate that this was intentionally a complete reversal of the
tactics that had been employed by Mikheil Saakashvili’s Georgian forces
in August 2008. Georgia’s small armed forces resisted the Russian
invasion immediately, vigorously and with notable early success. As
events of this Crimean war unfold, this Ukrainian tactic may be either
praised or criticised, but the immediate effect was a propaganda
victory and a palpable frustration in the ranks of the enemy.
defeat of Putin’s propaganda was the immediate discrediting of a staged
Ukrainian terrorist attack on suitable “victims”. Reporters caught the
arrival of these visiting “terrorists” on locally licensed buses,
including one tour bus from the local zoo and noted that they were
armed with the latest Russian arms . The “victims” had no visible
traces of blood. Journalists later collected spent cartridges and
reported that they were clearly blanks . A video was used by Putin
to ask his Parliament to authorise the introduction of Russian forces
into Crimea, days after they were already there.
On 3 March
2014, as US administration officials were reporting that the Russians
had total control of Crimea, German Chancellor Angela Merkel told
President Obama that she felt that Putin had lost touch with reality
and was in another world . That same day the US carrier President
George HW Bush with a fleet of 17 warships approached the Black Sea
placing Crimea within range of its aircraft. No further developments
came from this.
On 5 March 2014 the guided missile cruiser
Truxton was reported sailing through the Bosphorus. Inside Crimea,
special envoy Robert Serry of the Secretary General of the UN was
prevented from completing his duties by unidentified armed men in
uniform. They stopped his car and held him virtually hostage in a
coffee shop. Later he was allowed to go directly to the airport in
Simferopol to leave Crimea. That same day the representative of the
OSCE on matters of freedom of speech, Dunia Miatovych, had been
blockaded in her hotel, the hotel Ukrayina, by men in camouflage and
body armour. She was finally able to leave the building and fly back to
Kyiv. She had been meeting with editors of the local media and
community activists .
That day, a company of the Ukrainian
Army, the Dnipropetrovsk Paratrooper Company who was in Crimea for
training along with the 36th Coast Guard Marines were asked to disarm
by the invading Russian forces. The Ukrainian side refused, explaining
they had enough ammunition to hold off a siege. And once the ammunition
ran out, they explained, they would blow up their light armour along
with themselves and the enemy, taking to guerilla tactics .
the night of 5-6 March 2014 in Donuzlav Bay, the Russians attempted to
block the entrance into the harbour by sinking two of their own ships,
the Ochakiv and the rescue tug Shakhtar , to trap the vessels of
the Ukrainian Navy stationed there.
For the next few days
Russian activity was limited to the blockading of all Ukrainian
military bases and harassment of Ukrainian military personnel. On 10
March 2014, near the village of Chongar in the Kherson oblast’
(province) just north of the Crimean border, a Crimean Berkut road
block stopped an Avtomaidan motorcade carrying mail and humanitarian
aid to blockaded Ukrainian soldiers. The riot police opened fire,
wounding one man from Zaporizha in the chest .
Service of Ukraine reported that early in the morning on 12 March a
group of Russian “spies” had been intercepted by Ukraine’s SBU (Sluzhba
Bezpeky Ukrayiny, Security Service). The group was reconnoitring the
208th brigade of surface to air defences along with the 79th mobile
brigade around Kakhovka in the Kherson oblast. Kakhovka is the location
of the hydro power station that supplies all the electricity to Crimea.
The leader of the group was an officer of Russia’s GRU, born in 1981 in
the Ryazan Oblast of the Russian Federation, but using the Ukrainian
passport of a Yevhen Arbuzov born 1986 . That same day, news media
reported the build up of Russian armour on the northeast border of
Ukraine, barely 50km north of Kharkiv , Ukraine’s second largest
The preparation of a causus belli in eastern Ukraine began
13 March 2014 with a violent clash between pro-Russian and
pro-Ukrainian demonstrators in the city of Donetsk. This resulted in
possibly the first fatality of the Ukrainian-Russian conflict. The
clash resulted in three wounded and one dead . It was later
reported that many of the demonstrators were Russian citizens. Similar
events occurred in Kharkiv  and other eastern cities the next day.
March 2014 was also the day that the acting Prime Minister of Ukraine,
Arseniy Yatseniuk, met with President Barak Obama in Washington DC,
who, despite assurances and platitudes, refused to ship arms to Ukraine
. This lack of tangible military aid was especially troubling in
light of the fact that it was Senator Obama, along with Senator Lugar,
that in 2005 convinced then Ukrainian President Yushchenko to scrap
400,000 small arms and 1000 surface to air missiles . These
weapons, that had been left over from Soviet times, were now sorely
needed by the newly recruited National Guard that was being formed to
reinforce Ukraine’s existing army.
On 15 March 2014, Russian
airborne troops landed their helicopters near the village of Strilkove
in the Kherson oblast’ and seized the gas distribution station that
supplies Crimea with natural gas . This was noted by Sen. John
McCain who was in Kyiv that day ahead of the Crimean referendum; part
of a bipartisan group of US senators. Sen. McCain called for military
assistance to Ukraine as the right and decent thing for America to do
. Canada’s Foreign Affairs Minister John Baird announced that Prime
Minister Steven Harper would travel to Kyiv for meetings with Prime
Minister Arseniy Yatseniuk on 22 March 2014, making Harper the first G7
leader to do so during this crisis . On 16 March 2014 Crimeans
voted in the Referendum that offered two Yes choices, and no “No”
The choices were:
1. Are you in favor of the reunification of Crimea with Russia as a part of the Russian Federation?
2. Are you in favor of restoring the 1992 Constitution and the status of Crimea as a part of Ukraine? 
return to the 1992 Constitution -- adopted after the Soviet collapse
but quickly thrown out by post-Soviet Ukraine -- effectively provided
for Crimea’s independence, while remaining part of Ukraine.
reported results were 97% for option 1 (96% in Sebastopol) with a voter
turnout of 83% (89% in Sebastopol) . On 18 March Russian President
Putin announced that Russia would incorporate Crimea. As of the time
this article is being written, this annexation has been recognized by
only Armenia, Syria, Kazakhstan and Venezuela, and all Russian client
states. Significantly China has not recognized the validity of the
referendum. Quite notably, during the UN Security Council vote, China
had abstained from voting. It is quite possible that it was positioning
itself as the impartial arbiter in the hope of forming the UN
peacekeeping force in Crimea if events ever lead to that. That would
then be China’s first foray onto the European stage.
It is no
secret that Russian control of Crimea terrifies the indigenous Crimean
Tatar population. The Tatars had lived in Crimea for some 700 years. It
was only after the Russo-Turkish war (1768-1764) that Russia gained
control over Crimea, which it quickly annexed in 1783 . In 1944
Stalin deported the entire Tatar population of Crimea to Central Asia
after regaining control of the peninsula from the retreating Germans
. Half of the deportees died en route. Tatars were not allowed to
return to Crimea until the late 1980’s. The Tatar Mejlis (council),
fearing a return of Russian brutality, had enthusiastically supported
keeping Crimea as part of Ukraine . Their worst fears were
confirmed the next day. On 17 March 2014 the body of Reshat Ametov was
found showing signs of torture . Reshat had disappeared in
Simferopol on 3 March 2014.
The next day added more victims of
Russian violence. One Ukrainian soldier was killed by a bullet through
the heart and another officer was wounded during the storming by the
Russians of a photogrammetric center in Simferopol. The Russians used
snipers for this task and withheld medical help after the shooting.
They arrested all Ukrainian military personnel at the station. 
Crimea is an economic basket case. It depends entirely on Ukraine for
its electrical power and its natural gas. Up to 80% of this desert
peninsula’s water supply comes via canal from Ukraine. It is connected
by road and rail only to Ukraine. There is only a ferry connection
across the Kerch Straits to mainland Russia. These were, in fact, the
reasons that Crimea was transferred to the Ukrainian SSR in 1954. These
are also good implications that Russia cannot stop at Crimea, but will
also make an attempt to take the neighboring Kherson oblast’ (province)
just north of the peninsula.
However, the Black Sea shelf within
Crimea’s territorial waters contains significant deposits of natural
gas and oil . Both Exxon and Shell are involved in the exploration
and development of these resources. A further benefit of the Crimean
annexation for Russia/Gazprom is the shorter, shallower and cheaper
route across the Black Sea for the South Stream pipeline . And so
while the anticipated invasion of Ukraine may, in fact, be about
historical mythology, the conquest of Crimea is not about history, nor
people, nor even language. The conquest of Crimea is about hydrocarbons.
Implications of Russia’s military occupation and annexation of Ukraine’s Crimean peninsula:
1994 Ukraine possessed the world’s third largest nuclear arsenal. Under
pressure from US President Clinton and Russia’s President Yeltsin,
Ukraine signed an agreement to divest itself of all its nuclear
weapons. In exchange for that action, Russia, the UK and the USA
undertook to respect Ukraine’s borders in accordance with the
principles of the 1975 CSCE Final Act, to abstain from the use or
threat of force against Ukraine, to support Ukraine where an attempt is
made to place pressure on it by economic coercion, and to bring any
incident of aggression by a nuclear power before the UN Security
Council . This agreement is usually referred to as the Budapest
Memorandum. As with many such agreements, this agreement is legally
binding, but not enforceable.
What must be asked is what are the implications of not guaranteeing Ukraine’s territorial integrity militarily.
implication to Ukraine is self-evident: the loss of Crimea, its
territorial waters, the oil and gas reserves of the Black Sea shelf,
the freedom of the Kerch Strait and of a domestic Cote d’Azure
vacationing spot. Offsetting that is the decrease by two million of the
population of Russo-phones that have always represented, if not
necessarily a fifth column, then surely an Achilles heel with respect
to Ukraine’s eastern neighbour. A less obvious benefit will be a more
sober view by Ukrainians of their eastern neighbour and of any of their
own citizens that refuse to learn the country’s official language.
implications to Crimea are somewhat sadder. Among them are no
electricity, much less fresh water, loss of tourism, loss of
agricultural capacity, conflict with a Crimean Tatar insurgency, and
the oppressive boot of a militaristic imperial regime.
benefits to Russia are many, including additional gas and oil reserves
for Gazprom, a safer, cheaper and shorter route for the South Stream
pipeline, expanded basing capacity for the Black Sea Fleet, an
additional two million Russian Orthodox, Russian-speaking citizens and
an overall dominance of the Black Sea. Offsetting this will be a fresh
insurgency by a Muslim minority, likely supported by both Turkey and
But it is the implications for the rest of the world
that are most worrying. The relative peace in this world has been a
result of interconnected treaties, agreements and yes, memorandums.
What this peace didn’t need today is the realization that the words of
agreements are worth less than the paper they are written on. Nuclear
disarmament and nuclear non-proliferation will be reversed . Easily
a dozen non-nuclear-armed countries will have to reconsider that
position. Certainly among them will be Japan, South Korea, Taiwan,
Iran, Egypt, Poland, Ukraine , the Baltic states, Finland, and yes,
Resource-rich, under-populated Canada may prove to be
the most vulnerable of all. It could be said that the refusal to build
a pipeline has be seen as an unfair trade barrier by some distant
energy hungry land. Or, given the opening of the North West Passage,
would the sudden appearance of 10,000 armed men without insignia on say
Ellesmere or Baffin Island prove to be a fait accompli?  In the
end, enforcing the unenforceable may prove to be less costly than the
If Putin’s imperial adventure ends up being limited
to the Crimean peninsula, there may be one more sanction that could be
applied. Today the world has come to understand the concept of
“conflict diamonds” and the penalties applied to their sale. It may be
appropriate to coin the concept of “conquest hydrocarbons”. The entire
volume of extracted hydrocarbon resources from this conquered territory
will be deemed to be included in the exported hydrocarbon stream. A
penalty tax of 100% of the wholesale export price including transit
cost would be applied to this volume, payable on a pro rata basis by
the various importing countries/entities. Suitable penalties for
under-reporting and audit procedures would be applicable to companies
extracting these hydrocarbon resources. The money so collected would be
paid to the victim country’s state treasury as compensation.
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 Hydrocarbon discoveries.
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 Ukraine and Nuclear Proliferation, Accessed March 23, 2014, The Wall Street Journal.
 Paris fiasco, by V. Ohryzko the once Minister of External Affairs. Accessed March 23 2014, Ukrayinska Pravda
 Russia Paradrops Airborne Battalion in Arctic. Turkish Weekly. Accessed March 14, 2014.
Myroslav Petriw, a recipient of the
Anna Pidruchney Award for New Writers, the Shevchenko Medal, and the
Queen Elizabeth II Diamond Jubilee Medal, is President of the Ukrainian
Canadian Congress Vancouver Branch, and author of the
historical-political thrillers Скарб Ярослава (published 2003 in
Ukraine), Yaroslaw’s Treasure (2009) and Yaroslaw’s Revenge (2012).