Rene -- God Save the Shah: American Guns, Oil and Spies in Azerbaijan -- 07.03.03
God Save the Shah
American Guns, Oil and Spies in Azerbaijan
By Mark Irkali, Tengiz Kodrarian and Cali Ruchala
"WE MOVE FROM DREAM TO REALITY!"
Amid the polite applause that one might expect from an audience of
diplomats, a member of the audience coughed loudly. His harsh, gasping
rasp was embarrassingly on cue. He covered his mouth with a balled-up
fist. The speaker - Azeri president Heydar Aliyev, whose appearance
dispelled yet another rumor circulating through Baku and Tbilisi that he
was dead - continued without acknowledging it.
The speech was broadcast live on television - such is the importance of
a new pipeline in the Caucasus.
The Baku-Tbilisi-Ceyhan Pipeline (or BTC, as insiders call it) did
indeed begin as a dream during the early 1990s, and the Americans
considered its approval their top priority in the whole of the region.
The idea was to get the massive deposit of oil beneath the Caspian Sea
to market without having to rely on the goodwill of either Russia or
Iran, the two regional heavyweights. Today, more than ten years later,
construction is finally underway.
The next speaker also underlined the importance of the BTC to America.
US Energy Secretary Spencer Abraham - rewarded for losing his seat in
the Senate with a cushy cabinet appointment - took the podium and read a
statement from President George W. Bush.
It was a typical snowjob, though the prestige of an American president
gracing the Caucasus region, even if by proxy, forced the man with the
raspy cough to bite down hard on his knuckles. Bush intoned via Abraham
that building the snaking pipeline from the Azeri capital of Baku to the
Turkish Mediterranean port of Ceyhan would have a number of astonishing
including "enhancing global energy security" and "strengthening the
sovereignty and independence of countries in the Caspian Basin."
AMERICAN OIL DRIVE
DEPENDING ON WHO you talk to, the BTC is either the reason for the
extensive American involvement in the Caucasus, which began in the 1990s
and has been slammed into overdrive since 9/11, or simply a pretext for
increasing American military presence in the geopolitically important
southern extremities of the former Soviet Union. Two things are beyond
America has, for the moment at least, wrested control of most of the
independent states of the Caucasus from Russia's sphere of influence,
and there are now American military forces on the ground.
The latter is something that Georgia and Azerbaijan have long desired as
the easiest way to acquire western military hardware and training, but
not to protect them from Russia. The weapons and know-how will almost
certainly be used first to subdue several ethnic statelets which broke
away in the early part of the 1990s: Abkhazia, South Ossetia and, from
When completed in 2005, Baku-Tbilisi-Ceyhan will cross more than 1,000
miles of territory. Construction will cost around two and half billion
dollars, give or take a few hundred million. Skeptics scoffed - and
continue to scoff - at the project; one contacted for this story called
it "the most expensive playground ever built," and disputed that there
would ever be enough demand to justify such an expenditure.
But the cost cannot just be measured in dollars and lari. American
influence in the Caucasus has been a painful, often sordid affair. Back
in the 1970s, the American government invited dissidents to dinner to
show their support for human rights in the USSR. In the 1990s, two men
feted for their courage on such occasions were overthrown by dinosaurs
from the Communist Party who, in Soviet times, had been their chief
persecutors. American support has flowed to the former apparatchiks as
these two former disciples of Leonid Brezhnev unleashed a column of fire
on their own people, guided by American advisors, their positions
buffeted by American aid.
And it can only get worse. The Caucasus has become the new Central
America: a place crawling with CIA agents and other shady characters
dispatched to back two of the most repressive, unstable regimes in the
former Communist Bloc.
Over the last twelve years, Israel is the only country in the world
which has received substantially more aid than Georgia. The CIA trained
President Eduard Shevarnadze's security detail, while jails and
cemeteries filled with his opponents. In the Spring of 2002, America
took the plunge and dispatched a contingent of Special Forces to
train-and-equip the Georgian army in
"anti-terrorist" operations, using the pretext that al-Qaeda fighters
had been spotted in the country (their existence was disputed at a
Washington press conference by no less an authority than the Georgian
Defense Minister, obviously a man not in on the plan).
American support for Shevardnadze in Georgia, guardian the vulnerable
central link of the BTC, has at least been public. The same cannot be
said for the efforts of America in Azerbaijan. In the early 1990s, with
a war in the breakaway province of Karabakh, the country seemed to be on
the verge of disintegration. The first independent government was headed
fossils; the primary apparatchik was Ayaz Mutalibov, noted as the only
head of a Soviet republic to welcome the hardline coup against Mikhail
With the army battered by the Armenians of Karabakh, and the government
criticized by an increasingly hostile public, the Azeri president turned
to the few Americans in his country for help. Three men with backgrounds
out of a spy novel lent him their services. Over the course of the next
two years, the company they founded procured thousands of dollars worth
of weapons and recruited at least two thousand Afghan mercenaries for
Azerbaijan - the first mujahedin to fight on the territory of the former
And they did it under the guise of an oil company.
This story is the culmination of more than a year of investigation and
dozens of interviews in Georgia, Azerbaijan and Pakistan, as well as the
United States. It's a story about money, oil, weapons and the lengths
that some men will go to control the "new energy sources" that American
politicians have so often called for. Whether they were working for
themselves or for their country, the men behind the energy company with
the Orwellian name - MEGA Oil - wrecked havoc in the Caucasus, pursuing
goals which were remarkably in tune with America's primary aim in the
We will state up-front that we have discovered no documentary evidence
to tie MEGA Oil, as an entity, definitively to the United States
government. There is however considerable evidence that all three prime
movers in the company - former Iran-Contra conspirator Richard Secord,
legendary Air Force special operations commander Harry "Heinie"
Aderholt, and the man known as either a diabolical con-man or a
misunderstood patriot, Gary Best - were in the past involved in some of
the most infamous activities of in the history of the CIA.
In fact, the MEGA Oil debacle followed the model of the Iran-Contra
Affair with uncanny accuracy, down to the formation of shell companies
and, possibly, the use of private sector companies to contravene both
the letter and the intent of American law. Together with Oliver North,
Secord had pioneered this model in the 1980s to fund the Nicaraguan
Contras and make
themselves millionaires in the bargain. By a remarkable coincidence or a
cunning design, the MEGA Oil enterprise would have served the same purpose.
How much of it can be assigned to coincidence and how much to design is
left to the reader to decide.
BAKU GOES BOOM
AS IN THE Middle East, the most bitter conflict in the Caucasus was not
fought over oil, but rather over the single bit of territory in the
region which is comparatively bereft of it.
The Karabakh War was an ethnic war, in some ways corresponding to the
fighting in the Balkans, in other ways at odds with it. About 20 percent
of Azerbaijan's territory is presently - and probably permanently -
occupied by Armenian forces. The fighting in the first years of the
post-Soviet era was centered in the "Mountainous Black Garden" -
Nagorno-Karabakh - but the
Armenians presently control considerable territory outside the enclave
This conflict must form the backbone of any narrative of Azerbaijan's
lost decade, as mounting military debacles and successive tidal waves of
terrified refugees washing through the cities spurred on popular revolts
and undermined two presidents, further plunging the republic into
The post-Communist years will be known as the darkest years in
Azerbaijan's history. In the 1990s, one in every seven Azeris became a
war refugee. And yet, incredibly, the 1990s have been characterized by
some people in the West as an Azerbaijani Golden Age. Citing the
enormous untapped oil reserves discovered in the twilight of the Soviet
Union, these individuals gloried in the bright future of Azerbaijan and
produced impressive charts showing how much money American industries
were already pouring into the country in preparation for the great oil
Their numbers are not many, and the Americans who trumpet the "Baku
Boom" and the Azerbaijani Golden Age are among the few who can speak (or
do speak, regardless of ability) about Azerbaijan. Among them are
familiar faces from the American political establishment, such as James
Baker and John Sununu, both of whom have been employed as lobbyists by
the Azerbaijani government or various energy companies favourable to
improved relations between Azerbaijan and America. Unfortunately (and
predictably, to long term observers of the Middle East), little of the
money which has come to Azerbaijan has trickled down to the poor.
The oil rush of the 1990s was not the first that Azerbaijan has seen.
The first came in 1870 and attracted the cosmopolitan crowd of
investors, hucksters and fanatics that seem drawn by the heavy waft of
crude. By the turn of the century, Azerbaijan's oil exports exceeded
those of the entire United States.
The oil industry in Azerbaijan fell into decline during the Soviet
years, for reasons which parallel the American experience: it was
cheaper to bring oil to market from the fertile Siberian fields than to
dilly with a thousand small deposits in the Caucasus. The landscape of
Azerbaijan is littered with the red and black piping of abandoned wells
last tapped back in the 1960s.
In 1991, when the immense size of the Caspian oil shelf became known,
the derelict wells seemed even more antiquated, compared to the glossy
pictures of offshore platforms in the briefcases of chubby Texans in the
two Intourist Hotels that bookended Baku's Lenin Square. But to a group
of American investors with a background out of a spy novel, these scraps of
industrial decay smelled like an opportunity - or a suitable pretext,
depending on who you believe. And this is when our story begins.
THE P.O.W. CAPER
GARY BEST HAS made it his business not to be found. A self-described
"electronics importer," he has left a long trail of anecdote and
innuendo of past misdeeds but few testifying witnesses. He was a
marginal figure in one of the many subplots of the Iran-Contra Scandal,
though how exactly he was related to the activities of Oliver North and
his co-conspirators is
unclear. His importing business was concentrated primarily in Southeast
Asia, but somehow brought him into contact with the Afghan Mujahedin,
Iran-Contra conspirator Richard Secord and legendary Air Force special
operations commander Brigadier General Harry "Heinie" Aderholt. His
current mailing address, and his current profession, are unknown.
In 1985, Gary's business was headquartered in Marietta, Georgia. What
exactly his company did, and how he spent his days, is a mystery. Bob
Fletcher, another figure on the periphery of Iran-Contra, claims that in
1985, Gary Best became a partner in his toy company, which he and other
Iran-Contra figures planned to use as a cover for illicit weapons
transfers of the sort that made Ollie (and Secord) famous. There's been
no convincing evidence that this is true, and Fletcher has since built
an inspiring career as a first-class conspiracy kook. He later became a
spokesman for the Militia of Montana, fondly remembered by law
enforcement for issuing liens on strangers' property, the glare from
their giant belt buckles and their tense stand-offs with federal marshals.
But for his other activities in the late 1980s, Gary Best might be
considered somewhat less credible than a run-of-the-mill crank babbling
about weather control technology. Knowing people in his business in
Southeast Asia (whatever it was), and with his connections to the
not-yet-victorious Mujahedin in Afghanistan (however he got to know
them), Best was in an advantageous position to capitalize on one of the
great popular delusions of 1980s America: the search for missing
American prisoners of war in Vietnam.
Though the evidence in favour consisted solely of the plotline in the
movie Rambo, many veterans and their widows hoped that the
liberalization taking place in the USSR under Gorbachev would lead to
the release of some of America's lost POWs. Their hopes were cruelly
bolstered when Stephen Morris, a right-wing Australian academic, claimed
to have found a document in the
KGB archives in Moscow which referred to "thousands" of imprisoned
American POWs, rather than the hundreds the North Vietnamese claimed to
be holding during the Paris Peace Talks. It came at an inopportune time,
delaying America's long-awaited normalization with Vietnam for several
months before the document was exposed as a forgery.
Meanwhile, "Russia's Vietnam" - the Afghan War - was just winding down
(the last Red Army tanks crossed the northern frontier of Afghanistan
only in 1989). Russian widows, wives and mothers of servicemen who had
not returned with their battered units also harboured hopes of securing
their loved ones' release. The two superpowers - America and the USSR -
were stymied in getting any answers from their former adversaries, but
both had relatively good relations with the other country's enemies.
Gary Best was better placed than most to bring America and the USSR
together over this issue, trading his contacts with the Mujahedin for
his Soviet counterparts' connections in Vietnam. Should any Americans
turn out alive, Best would be able to have them immediately transferred
to a hospital in Thailand, where his associates would look after them as
they began the long
Best left few traces of his involvement in this caper, though associates
would later give him credit for securing the release of several Russian
POWs held in Afghanistan. He allegedly made several visits to the USSR
as well as to Mujahedin headquarters in Afghanistan and Pakistan, and
former associates say that Best bragged about his friendship with
Minister Gulbuddin Hekmatyar who, like many former Mujahedin, is now a
sworn enemy of the United States. At the time of writing, Hekmatyar had
just been placed on a terrorist list by the State Department, and a
staffer contacted at his movement's headquarters in Pakistan was
understandably reluctant to discuss too many things with outsiders that
spoke English. A week later, the staffer, who claimed to be Hekmatyar's
son-in-law, told us that no one in the organization had ever heard of
Gary Best, and that they were unaware of any endeavors by Americans to
assist in locating Soviet POWs, or securing their release.
THE GENERAL'S JOINT VENTURE
BEST CONVINCED AT least one important ally of the sincerity of his
intentions. Brigadier General Heinie Aderholt isn't just a guy with a
lot of brass on his chest. Among special forces veterans and aspiring
students who read up on his career in Air Force-issue textbooks, Heinie
is a legend. He was in charge of dropping anti-Communist guerrillas
behind enemy lines in the Korean War, and conducted interdiction
campaigns to stem the flow of supplies to the Viet Cong. Among active
duty and retired servicemen, Aderholt is only a peg or two down from
Patton, McArthur and other Gods of War in 20th century American military
Aderholt also claimed to have bought into the possibility that American
POWs were still being held in Vietnam. Former associates say that Best
used Aderholt's prestige to add credibility to his crusade. But Best's
expensive trips around the world didn't pay for themselves. It wasn't
long before Best approached Aderholt with a proposal which would give a
shot in the arm and an infusion of cash into the search for American and
Soviet POWs and, possibly, make both of them millionaires in the bargain.
While traveling in the Soviet Union, Best had noticed the thousands of
rusting cages over abandoned oil wells, concentrated heavily in
Azerbaijan. He figured that capital costs to rehabilitate them wouldn't
be prohibitively expensive provided just a fraction of the wells could
be brought back into operation. Best boasted of his connections with the
Azeri government - a collection of scarcely reformed apparatchiks
wrestling with the popular revolts and waves of repression which marked
the death spasms of the Soviet Union. Aderholt wouldn't have to do a
thing except pitch the idea to investors: Best would take care of
everything in Azerbaijan when, of course, he wasn't flying around the
world, looking for skeletons long since turned to phosphor in the
humidity of the Vietnamese jungle brush.
Despite the unconventionality of the idea - forming a business to fund
what most would consider humanitarian work, when they didn't consider it
an outright swindle - Aderholt agreed. And that's when things really
started getting weird.
THE DREGS OF THE OIL RUSH
GARY BEST WAS but one of a horde of con-men and ruthless operators who
made the frightful voyage to Baku on Azerbaijan's state airline, which
began the 1990s with quite possibly the oldest and most ill-equipped
fleet of airplanes in the world. Among the figures of ill-repute to make
their way south was none other than Marc Rich, acclaimed scoundrel who
slid a few million greenbacks into the Iranian government's pocket while
its student-athletes were jogging blindfolded American Embassy staff
through the streets of Teheran. Rich was then still barricaded in his
palatial estate in Switzerland; it would be another ten years before his
ex-wife would emerge from bribing her way through nine rings of lackeys
in the Clinton
Administration to buy her husband a pardon from the commander-in-chief.
But Best drew first blood, ingratiating himself among the brahmins of
the Azeri Communist Party when agents from the big oil companies were
still trying get a foot in the door. A former Best associate named
"Andrew," who describes himself as a "hazmat broker" - he deals only in
those commodities which are toxic, flammable or explosive - sat down
with us in a Tbilisi
restaurant in February 2003 to describe how Best was able to do it.
"Gary is one of the most charismatic people I've ever known," he says.
"Not physically. He just looks like he's always on the verge of doing
something important and great. If you know him long enough, you stop and
say, 'Well, have any of these plans ever worked out? No, so ta!' But to
those who just meet him, Gary Best looks like a legitimate player."
Andrew didn't know who Heinie Aderholt was, but "Gary rubbed shoulders
with a lot of important people. You would never guess that every word
out of his mouth was a crock of shit. The secret of Gary Best's success
is that he disappears and reinvents himself all the time. He has to,
because he's always running away from people who are really pissed off
at him over one of his plans."
According to Andrew, Best has a warrant out for his arrest in the United
States and is probably traveling under a false passport (Best has had at
least one default judgment against him in a lawsuit - he never showed up
to contest the charges - but he is not the subject of any federal
warrant we could identify.) Like many people who have dealt with Gary
Best, Andrew is convinced that he's a CIA agent, or at least a former
one who retained some contacts in the intelligence community. He doesn't
think Best's work in Azerbaijan was part of an official operation, "but
with the crowd he had around him, who knows?"
The "crowd" expanded in 1991 to include another ghost from America's
past: prominent Iran-Contra co-conspirator Richard Secord. Whereas the
partnership of Best and Aderholt could be written off as a curious
pairing, the presence of Secord in Best's Azerbaijani oil venture ought
to have raised blood red flags around the world.
Secord is a man that many people believe should have been in jail in
1991 - just two years after copping a plea to a count of lying to
Congress (he was facing trial on eleven other felony charges). Instead,
we are to believe that this former mastermind of arms shipments and
shady deals with guerrillas and Ayatollahs was taken by the
possibilities of dead oil wells in Azerbaijan.
Best, Aderholt and Secord, with their lack of background in public
relations, might be forgiven for picking such an Orwellian name for
their venture as "MEGA Oil." Assuming that Aderholt and Secord were, as
they say they are, accidental patsies in Best's devious schemes, it's
still difficult to believe the atrocious due diligence that two men with
extensive backgrounds in intelligence executed. Conducting a post-mortem
on MEGA Oil - noting its birthdate and vital statistics - is almost as
tracking down Gary Best.
MEGA Oil's American partners wrote in press releases that the company
was based in either Marietta or Atlanta, Georgia. A search of public
records finds not one but two companies known as "MEGA Oil USA." One is
called "MEGA Oil USA/Vista Joint Ventures," and was incorporated in
1985. "MEGA Oil USA" on the other hand wasn't incorporated until 1993.
There is, moreover, a third MEGA Oil involved in the food processing
business. None of these Georgia companies could be definitively traced
To make up for MEGA Oil's lack of experience in the industry, Best
contracted a company which specialized in rehabilitating and servicing
existing oil wells. Ponder Industries, registered in Delaware but
conducting business in Alice, Texas, entered into partnership with MEGA
Oil in Azerbaijan feeling like they had trumped an entire industry.
Later, an Securities and Exchange Commission panel expressed
astonishment that Ponder had done even less due diligence on MEGA than
they would have with any Texas partner - almost as little as Aderholt
and Secord. Gary Best, insiders say, led Ponder to believe that his
connections with the Azeri government would take care of any problems.
As a result, Ponder agreed to fund and staff the oil wells in Azerbaijan
by themselves, as well as providing unspecified "operating costs" to
MEGA. All MEGA had to do was bring them the contract with SOCAR, the
Azeri state oil company. Best promptly faxed it over. It was written in
Russian, and no one in Ponder's office could read it. Incredibly, they
took Best's word that the fax was exactly what he said it was: a joint
venture agreement between MEGA Oil and SOCAR to service the abandoned
Ponder began flying their equipment and staff into Azerbaijan in late
1991 and January of 1992. The latter was the date when the conflict in
Karabakh, which had hitherto been fought by guerrillas and militias,
exploded into a full-scale war as Azeri soldiers pounded the Karabakh
Armenians' "capital," Stepanakert, with thousands of rounds of artillery
fire. It was intended to
soften the Armenians' position, with thousands of fresh troops following
the path of fire.
The hopes of the Azeris for a quick and decisive thrust into Karabakh
were bolstered when their American friends offered to help
train-and-equip their beleaguered armed forces, and even bring in some
of their old special forces friends to lend a hand in drilling and
structural reorganization. MEGA Oil, a company in Azerbaijan which was
created in order to fund a farcical search for POWs in Vietnam, was now
A PRAETORIAN GUARD FOR MUTALIBOV
IN AN INTERVIEW with Baku-based journalist Thomas Goltz, Heinie Aderholt
claimed that representatives of the Azeri administration of Ayaz
Mutalibov - the technocrat-in-chief in Baku - had asked him if he could
facilitate the hiring of a large contingent of Afghan Mujahedin to fight
in Karabakh. Aderholt says he refused. But he went along with the plan,
Best, by which American special forces veterans would train the hapless
Azeri army then being pummeled by Karabakh Armenian irregulars, while
obtaining weapons for the Azeris through their own channels.
Others say that this was the plan all along - and that the oil rig
rejuvenation program, the POW search and the contract with Ponder was
nothing but a smokescreen to cover up a covert train-and-equip program
conducted with the tacit approval of the United States government. There
is, in fact, a remarkable congruency between what Secord, Aderholt and
Best were doing in Azerbaijan, and the strategic aims of the United
States in the Caspian region.
The Americans' avowed priority in the Caucasus was to find a method to
deliver the crude from the Caspian oil shelf to market, avoiding both
Russia and Iran as middlemen. Since the oil would flow from Azerbaijan,
this strategic goal was quite at odds with the American government's
favouritism towards Armenia in the Karabakh War.
In fact, providing support of any kind to Azerbaijan was illegal.
Congress passed a law (Section 907 of the "Freedom Support Act")
effectively banning foreign aid - and, needless to say, all military aid
- to Azerbaijan. Thus America's top long-term interest in the Caspian
was threatened by the promises of Armenian-American retribution at the
polls - a very real threat
considering Armenian electoral power in the key state of California.
Those who allege that MEGA Oil at least began as a project approved by
Washington point to the involvement of Richard Secord, whose visit to
Azerbaijan in early 1992 came at MEGA's expense and coincided with the
company's negotiations with Mutalibov on building Azerbaijan's army.
Secord's only public comment on the matter to date was to state that
Mutalibov couldn't decide whether he wanted his American friends to
build an army or a Praetorian Guard to hold onto power.
At the heart of the Iran-Contra controversy, of course, was a
Congressional ban on aid to the Contras strikingly similar to Section
907, and Secord's primary role in that first scandal was as the head of
a private corporation which worked at the behest of Oliver North for
covert and illegal weapons procurement for the Nicaraguan Contras.
Many forget that Secord's involvement in the Iran-Contra Affair was
motivated to a large degree by personal profit. The special
investigator's report on Iran-Contra concluded that "one of Secord's
central purposes in establishing and carrying out the operations of the
enterprise was the accumulation of untaxed wealth in secret overseas
accounts... that [Secord] received at least $2 million from his
participation in the enterprise during 1985 and 1986, that he set up
secret accounts to conceal his untaxed income, and that he later lied
and encouraged others to lie to keep it concealed."
JUST MONTHS FROM when the special investigator's report on Iran-Contra
was finally published, the final arrangements were being worked out with
Mutalibov on military procurement and training. The bulk of the aid was
diverted away from the Azeri army and into building up Azerbaijan's
interior ministry forces, serving solely at the behest of the president.
But MEGA's support came too late for Mutalibov. In late February of
1992, the Karabakh Armenians launched a counter-attack which the Azeris
hadn't planned for. Large swaths of territory were overrun. Within a
week, popular demonstrations had forced Mutalibov to resign.
By March, Ponder Industries had brought enough of their equipment and
personnel into the country to begin work on the oil wells.
Anti-Mutalibov demonstrations by the opposition Popular Front forced
them to delay, but their project leaders inside the country - including
a relative of Ponder's septuagenarian founder, Mack Ponder - didn't seem
especially upset when MEGA
Oil's most prominent Azeri supporter fled to Moscow. They received the
green light from Best in April, and began work immediately thereafter.
Mutalibov returned to Azerbaijan in an attempted coup, but lasted just a
single day. After a brief interregnum, Popular Front leader Abulfaz
Elchibey became Azerbaijan's new president. Elchibey was a former
dissident and he carried into office an almost mythical reputation for
honesty. Years before, after concluding a series of lectures at a
university in the Middle East, he
shocked his hosts by refusing the rather modest payment promised him. As
a foreigner, he told them, he couldn't accept money from a country whose
people were so poor.
Industry analysts have difficulty reading the lines on a person who, all
other things being equal, is nothing if not his own man. In corporate
jargon, Elchibey was a wild card. In July of 1992, after several months
of ambiguous hints and rumors, the Azeri government ordered Ponder to
cease all operations. MEGA Oil, the government stated, had no contract
with the government oil company, SOCAR, to undertake the work they were
doing. When company representatives unfolded copies of the joint venture
agreement MEGA had signed with SOCAR - the Russian text faxed to Ponder
Headquarters in Alice, Texas - the bureaucrats laughed. Not only was it
a forgery, but it wasn't even a forgery of the joint venture agreement
it was purported to be.
Ponder had been billing MEGA for work done and for capital sums they had
given to MEGA agents in Azerbaijan - a total of $8 million in invoices
in scarcely three months. SEC papers show that Ponder's accountants,
exasperated by the blind faith their clients put in MEGA Oil, attempted
to track Best down during a whirlwind visit he made to America in
mid-1992, but were unable to obtain any documentation confirming his
After Ponder was ordered to stop drilling in July of 1992, the company's
corporate officers listed the sums spent in Azerbaijan as capital
expenditures - the type of accounting shenanigans that their Texas
energy big brother, Enron, would later make famous. SEC filings in the
investigation of Ponder underline the investigators' state of disbelief
that a company with so many years experience in the oil business would
take on such a risky venture based on so little. (Ponder's officers made a
settlement with the Feds, though the company never recovered. Curiously,
they also delayed seeking redress in American courts against MEGA Oil
for more than six months after they learned the truth about MEGA's
relationship with SOCAR. A few years later Ponder filed for Chapter 11
bankruptcy. They merged with another small energy company, N-Vision, in
January of 2001.)
Heinie Aderholt parted ways with Best a month after Ponder was ordered
to cease operations by SOCAR. Richard Secord, he claims, went with him
(Secord and Aderholt have known each other for years, as both were
attached to Air Force intelligence, and later became neighbours in Fort
Walton, Florida, where a great many old fighter pilots go to die). But
though the company was finished in the oil industry - and by now the POW
crusade was completely forgotten - MEGA Oil still had some business to
conduct. Mutalibov had requested more than weapons and training - he
wanted real, live bodies to fight a war the Azeris were losing, or to
protect himself from a nation that hated him. Aderholt says he refused
to participate on the basis of
principles which he had, apparently, developed in the two or three years
since the Cold War ended. But when Elchibey's government posed the
question, nobody was left at MEGA Oil who would turn them down.
LAST GASP FOR KARABAKH
LIKE MANY AFGHANS, Abdullah only uses his first name. Thankfully, there
aren't very many people named "Abdullah" in Tbilisi's underground to
confuse him with.
Abdullah was 16 years old in 1986, when he fled his village along
Afghanistan's eastern border for Pakistani city of Peshawar. Tens of
thousands of other Afghan refugees live in Peshawar, and the city was
the nerve center for the American campaign of support for the Mujahedin
during the Afghan War.
Once crawling with intelligence agents dispensing thick stacks of rupees
and RPGs, in the 1990s the spooks left, but Peshawar continued to be the
world's greatest illegal arms bazaar and a recruiting ground for
Soldiers of God fighting in conflicts around the world.
Abdullah was selling fruit in his neighbour's stall in Peshawar when he
met a slender, bespectacled American who offered him two thousand
dollars to fight in Karabakh. Upon arriving in Azerbaijan, the agent,
Abdullah found out, worked for Gary Best.
In September of 1992, Azerbaijan's new Popular Front officials in the
Defense Ministry called up thousands of young Azeris for military
service. The army's aging officer corps was not entirely pleased. The
Armenians had by now drilled themselves into the Karabakh hills like
ticks, and the top brass reiterated that throwing untrainted conscripts
at their positions en masse would be suicide (after all, it hadn't
worked up until now). Once again they pressed the ministry to outfit and
train a crack cadre of special forces that wouldn't bristle at the
Best's mysterious international connections once again worked to his
advantage. Abdullah was one of an estimated 2,000 Afghan mercenaries
hired by MEGA Oil to wear Azeri uniforms and face the Armenians head on.
(The Afghans were split between separate parts of the country; Abdullah
himself claims to have trained with 200 of his fellow countrymen.)
It's difficult to house a few thousand foreign soldiers and keep it
quiet, especially in a country as small as Azerbaijan. Abdullah tells us
that he and his compatriots were never permitted to leave the base. As
the recruits' identity papers had been confiscated upon their arrival in
the country, they had no doubt that any attempt to desert would result
in their arrest as illegal migrants - their American handlers had
several times threatened to do just that in disciplinary proceedings. In
spite of his precautions, Gary
Best's Afghan enterprise was soon common knowledge all over the
Caucasus, even in Armenia and Karabakh, though no one had yet collected
enough evidence to substantiate it.
MEGA Oil's Karabakh adventure was the first time that Afghans fought
inside the boundaries of the former Soviet Union. In later years, they
would flock to Tajikistan and Chechnya in aid of embattled Muslim
rebels, hijacking what were more or less independence struggles for
their own war to further the reach of fundamentalist Islam. Importing
hardcore Mujahedin could have been disastrous for Azerbaijan as well.
For a variety of reasons, it wasn't.
Elchibey's government wanted experienced soldiers - the mujahids who
have put the fear of a fire-breathing Allah into Christians and
Communists on four continents. But most of the Afghans hired by MEGA Oil
were like Abdullah: poor refugees whose only connection to war had been
their flight from it (something they shared with a great many Azeris).
Very few of the
Afghans, according to Abdullah, had any fighting experience whatsoever.
Best had bought Afghan refugees for pennies, and sold them as million
dollar Afghan Mujahedin.
According to Abdullah, and confirmed by people involved in the project
interviewed by Thomas Goltz in the mid-1990s, the "well-armed" part of
MEGA Oil's Afghan enterprise wasn't quite accurate, either. Much of
Azerbaijan's heavy weaponry had been lost in Karabakh during the
previous winter's Armenian counter-attack. Goltz even alleged that many
of the Afghans given
RPGs and anti-armour weapons watched in horror as their rounds bounced
harmlessly from Armenian positions. They had been firing practice
rounds, remarked and sold at discount prices as live ammunition.
In addition to Afghans like Abdullah, Best imported in several dozen
American veterans to replenish those who had walked away in disgust
after Best, Aderholt and Secord's original plans had been shelved with
the fall of Mutalibov. According to Goltz, many of the "legitimate"
American mercenaries scoffed at the new meat Best brought in as "the
type of psychos who answer ads in magazines." Abdullah remembers things
differently - all of the Americans, he claims, were arrogant sadists and
willing collaborators in the scheme. Even worse were some of the Turkish
"advisors" - some allegedly members of the fascist Grey Wolves movement
- that the Turkophile Elchibey had added to the project, one of whom
shot an Afghan recruit in a brawl. Training was hard, and the Afghans
were given spoiled food and hand-me-down uniforms mended with patches.
The winter offensive began in December. The Popular Front began a
massive program of agitation among the Azeri population, with one of
Elchibey's advisors threatening to launch nuclear warheads into Karabakh
to teach the Armenians a lesson. It soon became clear that the offensive
was a complete failure. Thousands of Azeris were killed, and in another
Armenians for the first time occupied Azeri territory outside of
Karabakh itself. People that Goltz spoke to blamed Azerbaijan's military
brass for using the "elite troops" that Best had acquired as "cannon
fodder." Abdullah has a different explanation.
"When the shooting started, we were surrounded, and we ran," he says.
Though miles away in Tbilisi, one gets the impression that the battle
for Abdullah is just over the next hill. He fidgets and runs a hand
through his thick black hair.
"You must understand that most of us had only fired a gun a few times,
never an automatic weapon. Only a few of us had fought before, and when
we looked to [these] people to lead us, they were unable to communicate
with the Azeris. We didn't speak the language and nobody spoke ours. The
orders were to advance at any cost, but it was clear that the people who
issued these orders did not know what we were fighting. We looked at the
maps. Were we in the wrong place? No, but they gave us maps from forty
years ago! The village at the top of a hill was burned to the ground.
The Armenians were in it and
they were shooting down at us. But according to the map, there was no
village at all!"
The Azeri regular forces fared no better. An element of farce permeated
the sackings and dismissals as the Elchibey government searched for a
scapegoat to blame for the latest Azeri military disaster. The closest
thing the Azeris had to a war hero, Colonel Surat Husseinov, decided to
spare his troops the pleasure of hurling the lifeless bodies of their
Armenian machine gun nests and withdrew of his own accord from
Kelbadzhar. The Armenians swooped down in their wake. While gaining
thousands of new refugees from the area, Azerbaijan had lost one of its
last pieces of Karabakh. Essentially, the Karabakh War was over.
THE GREAT UNRAVELING
WORSE FOR AZERBAIJAN'S leaders, Armenian troops combing the battlefields
had found many dark-skinned Afghan corpses among the dead. A few had
managed to hide identity papers, refugee cards, pictures of their
sweethearts and even, in one case, a clipping from a Peshawar newspaper
which carried a story about his son's academic achievements.
The evidence was leaked from Karabakh through the network of Armenian
organizations throughout the world. One enterprising journalist from the
London Observer sleuthed around and discovered the embryonic core of the
story of the oil company that trained combat squads, publishing a few
details about it in his papers' November 28, 1993 edition.
The true scope of American involvement in the Karabakh War became known
as more facts were ferreted out. New Jersey Congressman Frank Pallone, a
noted friend of Armenia who has even served as an election observer in
the unrecognized Republic of Nagorno-Karabakh, called for an
investigation from the floor of Congress. Embassies in the Caucasus
distanced their bosses from allegations that MEGA Oil, a company founded
by three prominent figures in the American intelligence community, had
enjoyed official backing all along.
Andrew, the "hazmat broker," says he was not surprised by the denials,
even though he gives contradictory answers as to whether Best & Co. had
official American backing. "There is a stench of failure when things
fail so badly," he says, repeating the old saw that "'Victory has a
thousand fathers; defeat is always an orphan.'" When pressed, Andrew
says that Best wouldn't have been able to obtain the kind of money
needed to hire and outfit a mercenary army from the paltry $1.8 million
Ponder claims to have advanced to MEGA in Best's oil well fraud.
"You learn a few things from being around people like Gary Best," he
adds, "And you better learn them, since you get nothing else from his
acquaintance. Governments are born without eyes, and the left hand
doesn't know what the right one is doing. In the best parts of the USA
like the agriculture departments, they have transparency and the left
and right guide each other.
"I don't think Gary's little adventure had official support, as in the
head of the CIA signing off on it. I do think he had a lot of friends in
high places and he was able to convince these people to trust him and
not blow the whistle on what he was doing. If it worked they all stood
to benefit. The army would be victorious and would be led by Americans.
That's a powerful advantage. We wouldn't have had all the problems we
have had here and it would have been owed to America. It didn't work
though, so instead you see only Gary Best."
GOD SAVE THE SHAH
ABDULLAH RAN FOR his life from the Afghan cemetery in Karabakh, and
didn't stop running until he crossed the border to Georgia. He says he
has knowledge of only one other Afghan known personally to him to have
survived the slaughter in Azerbaijan - a cousin, who made his way home
to Peshawar. Though that city isn't really their home, it is a sanctuary
exile turned permanent - the type of place which hundreds of thousands
of Azeris from Karabakh in squalid camps, neglected by their own
government for ten years running, do not know.
The American mercenaries, some of whom had been used as "force
multipliers" during the winter offensive, trickled home disgusted and,
needless to say, unpaid. There are reports that others stayed behind in
Azerbaijan, acting as muscle for various Azeri kingpins, though no
instances have come to our attention. Thugs and oafs, sadly, are not in
According to Andrew, one of the reasons Azeri President Elchibey was
willing to forgive MEGA Oil for their past transgressions was "his
pathological hatred of Russians." That was why MEGA's last remaining
founder returned to favour after building a Praetorian Guard for
Elchibey's predecessor and having his oil wells confiscated as punishment.
Russian support was indeed crucial for Elchibey's opponents in their
quest to have him overthrown. Surat Husseinov, the colonel who absconded
with his troops from Karabakh during the Afghan enterprise, rallied his
forces in his hometown of Gyandzha. Direct orders for him to return to
Karabakh or disarm went unheeded. Husseinov blew his ill-gotten fortune
re-equipping his troops and their numbers grew with the desertion of
thousands of Russian soldiers from the old Soviet base in that city. In
June of 1993, Husseinov marched on Baku, overthrowing Elchibey and
bringing a relic of Azerbaijan's Soviet
past, Heydar Aliyev - a former Brezhnev protégé and head of the Azeri
KGB - in tow. Aliyev later squeezed out Husseinov and placed his dopey
son, Ilham, into a prime position as head of SOCAR, where he remains to
this day, waiting for his father to die and to take his place as a
bejeweled sultan of a hungry nation.
Prior to Husseinov's mutiny, Elchibey was preparing to go abroad to sign
the so-called "Deal of the Century," granting rights to exploit
Azerbaijan's share of the Caspian oil shelf to a consortium of energy
companies for seven billion dollars. Aliyev signed the deal a few months
Brigadier General Harry "Heinie" Aderholt returned to his retirement
among the palm trees in Florida, from where he supervised the writing of
his biography by a sympathetic admirer. It carries no mention of MEGA
Oil, Gary Best, or most of his career for that matter. The debacle in
Azerbaijan seems not to have tainted his reputation in the slightest.
Richard Secord settled down in 1995, employed in a variety of offices
for Computerized Thermal Imaging, a health industry company based in
Oregon. He was made Chairman and CEO in 2002. Since he has taken over
the company, CTI's stock has fallen from $19 to about 11 cents per
share. Secord was subpoenaed in December 2002 to answer for having sold
about a hundred thousand shares of CTI stock ahead of an unfavourable
Food and Drug Administration ruling on a product they sell; he bought
the shares back a week later and made approximately $90,000 in the
bargain. A few days before press time, CTI's auditor, Deloitte & Touche,
severed relations with the company and CTI failed to release its fourth
As for Gary Best, his fate is unclear. Andrew repeated a rumor heard by
many former Best associates that their man had been nailed trafficking
in nuclear materials in the port of Baku by the Azeri police. It was
later covered up, or so the story goes, because Azerbaijan under Aliyev
- a repressive, brutal dictator - is an American partner only for his
claims to have stabilized a
resource-rich country torn apart by war and ready to explode by a revolt
of the disenfranchised - in essence, a Shah and a Commissar in one. A
Freedom of Information Act request was sent to several departments of
the United States government which sought any and all documents relating
to Gary Best and MEGA Oil. Surprisingly, a request of a similar nature -
including all documents relating to Best and the export of nuclear
materials from the port of Baku - was already on record from the Summer
of 2002. It was denied.
One question persists at the end of the story: Were Best, Secord and
Aderholt out for their government, or out for themselves? When what was
done in Azerbaijan is done for the love of money, we call it greed. When
it's done for the love of America, we call it patriotism. The answer for
these particular patriots is likely to be mired in the dense gray area
between the two extremities. Except for the fraud perpetrated on Ponder
Industries, it appears that most of the dynamic trio's exploits were
fully in line with the policy held an administration desperate to lay
sole claim to a source of energy without any ties to the Iranians or
Russians, but unable to do so owing to the persistent pressure placed
upon them by the Armenian-American community. Despite a number of
violations of US law - paramount among them, the recruitment of an army
for a foreign prince or despot, a crime considered so grave by the
Founding Fathers that it is enshrined in the primary documents of the
American Republic - no one associated with MEGA Oil has ever been
charged. As more time passes and oil companies entrench themselves in
the Caspian region, the possibility becomes more remote that they ever
MEGA Oil's activities in Azerbaijan appear at first glance to have had
no long-term effects on the region: the two political chieftains they
supported were both overthrown, and the Azeris probably would have lost
Karabakh anyway. But the first glance is deceiving. Emerging from the
primordial hangover of seventy years of Soviet rule, the Caucasus
staggered through the
1990s like a victim from the scene of a bloody accident. Wars
hemorrhaged from Chechnya to Abkhazia, South Ossetia to Ingushetia,
North Ossetia to Karabakh. It didn't have to be this way.
The first Bush Administration disowned the only dissidents to take power
in any of the Soviet republics outside of the Baltics - Elchibey and
Gamsakhurdia - and Clinton built upon this bankrupt policy by
dispatching CIA teams to protect the new guardians of the BTC Pipeline
from their own people. The second Bush team has sent American soldiers
to train-and-equip the Georgian army, ready to unleash blitzkrieg on
ethnic minorities in Abkhazia and South Ossetia that broke away in the
early 1990s - and possibly against an Armenian enclave in the south of
the country as well.
The only thing preventing the Americans from offering the same sort of
"help" to Azerbaijan had been Section 907. In the interest of national
security, and to help in "enhancing global energy security" during this
War on Terror, Congress granted President Bush the right to waive
Section 907 in the aftermath of September 11th. It was necessary,
Secretary of State Colin
Powell told Congress, to "enable Azerbaijan to counter terrorist
President Bush utilized the waiver almost immediately. For Azerbaijan,
no more MEGA Oils will be necessary.