BY DAVID LEPPARD–PAUL NUKI AND GARETH WALSH From The [London] Sunday Times
*Political fallout: Lord Simon ran BP at the time of the coup A secret intelligence report accuses BP–Britain’s biggest company–of backing a military coup which installed a ruthless KGB hardman in the former Soviet state of Azerbaijan. Turkish secret service documen’s allege middlemen paid off key officials of the democratically elected government of the oil-rich nation just before its president was overthrown.
An intelligence officer says BP hoped for a better deal on oil concessions. He goes on to allege that it later consolidated its position with the new regime when the middlemen arranged to supply the incoming government with military equipment in an "arms-for-oil" deal.
Just months afterwards BP was handed the lead role in the consortium of western companies which now dominates the oil business in the region. The 5 billion deal–described as the "contract of the century"–was signed by Haydar Aliyev–the newly installed president.
Aliyev’s arrival was welcomed by Britain and America–which have a strategic interest in securing oil rights. BP has close links to British intelligence and employs several former MI6 officers. Aliyev is a former KGB chief; critics say he runs a repressive regime.
BP–which merged with Amoco in 1998 to create one of the world’s largest oil firms–admitted this weekend that it had been asked to pay a $360 million (235 million) bribe to the top Azeri official appointed by Aliyev to lead the oil talks.
But the company insists it refused to pay and denies any involvement in overthrowing elected governmen’s or link to arms deals. It disclosed that it has been conducting an internal inquiry into the allegations since learning of them earlier this month.
The Turkish intelligence document–a report on the alleged role of BP and Amoco in the events surrounding the 1993 uprising–claims the companies were "behind the coup" in which president Abulfaz Elchibey was overthrown and some 40 people died.
The report says: "As a result of our intelligence efforts–it has been understood that two petrol giants BP and Amoco–British and American respectively–which together forms the AIOC [Azerbaijan International Oil Consortium]–are behind the coup d’tat carried out against Elchibey in 1993. . ."
The allegations follow disclosures three years ago that BP’s security contractors in Colombia–a firm run by former SAS officers–were involved in supplying military equipment and training to a section of the Colombian army accused of human rights abuses. The company admitted it had supplied equipment to the Colombian army but denied any wrongdoing. Last year it was criticized by a Commons select committee for having too close a relationship with the Colombian army.
The latest allegations will embarrass Lord Simon of Highbury–Tony Blair’s former trade minister–who was BP’s group chief executive at the time of the coup. Despite Labor’s ethical foreign policy and Aliyev’s reputation as a hard-line autocrat–Blair gave him the red-carpet treatment when he visited London in 1998 to sign a friendship treaty and $13 billion (9.5 billion) in contracts with BP and other British firms.
When Azerbaijan won independence after the collapse of the Soviet Union in 1991–the world’s oil giants moved in to target the spoils.
BP’s development teams flocked to Baku–the Azeri capital–which soon turned into a Wild West boomtown of intrigue and fast bucks where oil executives rubbed shoulders with local Azeri mafia.
To the east of Baku–oil laps on the rocks of the Caspian Sea–the discharge from abandoned drillings. Beneath these waters are at least three oil fields with an estimated 200 billion barrels of high-quality crude oil.
The intelligence documen’s–which have been obtained by The Sunday Times from Turkish government files–are backed by a detailed statement from a senior security official.
The agent described last week how he met with BP executives to discuss an "arms-for-oil" deal. He said the company had contact with intermediaries who arranged for the supply of arms to the regime.
The former Turkish military intelligence officer said he was at meetings in Baku where arms deals were discussed. "Present in the meetings were representatives and what I understood to be senior members of BP–Exxon–Amoco–Mobil and the Turkish Petroleum Company. The topic was always oil rights and–on the insistence of the Azeris–supply of arms and mercenaries to Azerbaijan.
"All oil company representatives–including those of BP–offered the president and prime minister of Azerbaijan help in their war against Armenia."
He named one of those present as Terry Adams–then a senior BP executive.
In 1994 BP and other firms signed the 5 billion oil production-sharing deal with Aliyev to exploit the Caspian sea.
BP sources conceded last week that some oil company representatives did discuss the supply of arms. But Adams denies he or BP were involved. "It would be alien to BP’s culture," he said.
Roddy Kennedy–BP Amoco’s spokesman–denies it paid any bribes and says the company never helped supply arms. However–he admitted that the company had been asked by Marat Manafov–Aliyev’s right-hand man–to pay a $360 million bribe.
Six months ago Manafov disappeared after making allegations about "the secret dealings of the Aliyev family with oil companies". Police in his native Slovenia say they are investigating whether he may have been abducted or killed.