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Sludge Report #115 – More News About Oil

In This Edition: More News About Afghanistan And Oil - Caspian Oil Draws Crowd Of Ex-Washington Heavyweights - Feds investigate entrepreneur allegedly tied to Saudis - A Letter To President Clinton

NOTE: Authors of this report will be anonymous and wide ranging, and occasionally finely balanced. Indeed you are invited to contribute: The format is as a reporters notebook. It will be published as and when material is available. C.D. Sludge can be contacted at The Sludge Report is available as a free email service..Click HERE - to subscribe...

Sludge Report #115

More News About Afghanistan And Oil

The last Sludge report, Sludge Report #114 – The Great Game , has received quite a bit of reader feedback, including several contributions from readers included below.

Much of this material relates to material in a report published on Scoop in the immediate aftermath of WTC attacks, The GW Bush - Osama Bin Ladin Connection, some readers will also recall the Scoop commentary on this at the time, Sludge Report #106 – Who Was The Target?.


Thanks J for the following link… This link contains a reader discussion and a couple of relevant articles from 1992 and 1997 which are reproduced below. One of the readers involved in the discussion concludes, “wish the media was interested........”, damn right! - C.D. Sludge

TRANSCRIPT ONE: Caspian Oil Draws Crowd Of Ex-Washington Heavyweights

David B. Ottaway, Dan Morgan
Austin American-Statesman; Insight; Pg. J6
July 13, 1997

The last great oil rush of the 20th century -- targeted at a potential $4 trillion patch in Central Asia's Caspian Sea region -- has lured a prestigious group of U.S. prospectors: former high-ranking government officials bent on winning a stake in the bonanza for themselves or their companies.

These men are working together for policy changes that they say are needed to put U.S. companies on an equal footing with foreign competitors in Azerbaijan, a small nation that is at the center of a vast untapped oil basin.

Involved in the effort are two former national security advisers, Brent Scowcroft and Zbigniew Brzezinski; former White House chief of staff John Sununu; Defense Secretary Richard Cheney and Secretary of State James Baker from the Bush administration; and Lloyd Bentsen, a former Texas senator who also served as treasury secretary under President Clinton.

The involvement of these heavyweights has escalated an intense lobbying and public relations campaign in Washington. American oil companies hope to ease restrictions on U.S. aid to Azerbaijan, allowing them to secure U.S. government-backed loans and financial assistance as they tap into fields believed to hold as much as 200 billion barrels, more oil than any region outside the Persian Gulf. The restrictions were passed by Congress in 1992 to protest Azerbaijan's blockade of its fellow former Soviet republic, Armenia.

For many of these old Cold Warriors, the Caspian oil boom has provided a unique opportunity to help a former Soviet republic buttress its independence from Russia while taking advantage of a business opportunity.

Scowcroft, for example, was paid $100,000 in 1996 by Pennzoil Co. for consulting on special international projects,'' according to the firm's latest annual report. The former Bush adviser also earned a $30,000 director's fee from the company, which is a partner in the Azerbaijan International Operating Company, the main foreign oil consortium in Azerbaijan.

Scowcroft confirmed in an interview that he advises Pennzoil on its Caspian project but said his interest in the region stems from larger concerns.

I'm a big booster of Azerbaijan because the United States has big interests out there,'' he said.

Azerbaijan International, in which American firms have a 40 percent stake, is a client of the law firm of Baker, while Cheney is chairman of Halliburton Inc., an oil services firm operating in the Caspian fields.

Sununu's management consulting firm, JHS Associates, is expected to sign a major contract with Azerbaijan next month.

At a May reception in Washington for Azerbaijan's prime minister, Artur Rasizade, Bentsen likened Azerbaijan's struggle for independence to that of his home state of Texas, and beamed as an oil executive presented the prime minister with a pair of shiny Texas cowboy boots.

Bentsen is a shareholder in Frontera Resources, an oil services company working in Azerbaijan. Frontera is chaired by fellow Texan William H. White, a former Clinton deputy secretary of energy.

Brzezinski is a consultant to Amoco, another Azerbaijan International partner promoting Azerbaijan's cause in Washington.

Others with links to the region include former Rep. Charles Wilson, D-Lufkin, who is working with an energy developer.


TRANSCRIPT TWO: Feds Investigate Entrepreneur Allegedly Tied To Saudis

The Houston Chronicle A; Pg. 21
June 4, 1992, Thursday, 2 STAR Edition

Federal authorities are investigating the activities of a Houston businessman -- a past investor in companies controlled by a son of President Bush -- who has been accused of illegally representing Saudi interests in the United States.

The Financial Crimes Enforcement Network -- known as FinCEN -- and the FBI are reviewing accusations that entrepreneur James R. Bath guided money to Houston from Saudi investors who wanted to influence U.S. policy under the Reagan and Bush administrations, sources close to the investigations say.

FinCEN, a division of the U.S. Department of Treasury, investigates money laundering. Special agents and analysts from various law enforcement agencies, including the Internal Revenue Service and the U.S. Customs Service, are assigned to work with the FinCEN staff.
The federal review stems in part from court documents obtained through litigation by Bill White, a former real estate business associate of Bath.

White contends the documents indicate that the Saudis were using Bath and their huge financial resources to influence U.S. policy.

Such representation by Bath would require that he be registered as a foreign agent with the U.S. Department of Justice.

In general, people required by law to be registered are those who represent a foreign entity seeking to influence governmental action or policy.

An Annapolis graduate and former Navy fighter pilot, White, 46, claims that Bath and the judicial system, under the veil of national security, have blackballed him professionally and financially because he has refused to keep quiet about what he regards as a conspiracy to secretly funnel Saudi dollars to the United States.

White became entangled in a series of lawsuits and countersuits with Bath, who for some six years has prevailed in the courts. White says the legal action has financially devasted him and Venturcorp Inc., the real estate development company in which he and Bath were partners.

In sworn depositions, Bath said he represented four prominent Saudis as a trustee and that he would use his name on their investments. In return, he said, he would receive a 5 percent interest in their deals.

Tax documents and personal financial records show that Bath personally had a 5 percent interest in Arbusto '79 Ltd., and Arbusto '80 Ltd., limited partnerships controlled by George W. Bush, President Bush's eldest son. Arbusto means bush in Spanish.

Bath invested $ 50,000 in the limited partnerships, according to the documents. There is no available evidence to show whether the money came from Saudi interests.

George W. Bush's company, Bush Exploration Co., general partner in the limited partnerships, went through several mergers, eventually evolving into Harken Energy Corp., a suburban Dallas-based company.

Bush, known informally as George Jr., is a shareholder and director of Harken, which has been granted lucrative offshore drilling rights off the coast of Bahrain in the Persian Gulf. One of the top shareholders of Harken, a public company, is Saudi businessman Abdullah Taha Bakhsh.

Bush said that to his knowledge, Bath's investment was from personal funds, and no Saudi money was invested in Arbusto.

Bath, 55, a former U.S. Air Force pilot, declined to comment for the record. Spokesmen for FinCEN and the FBI also declined to comment.

According to a 1976 trust agreement, drawn shortly after Bush was appointed director of the Central Intelligence Agency, Saudi Sheik Salem M. Binladen appointed Bath as his business representative in Houston. Binladen, along with his brothers, owns Binladen Brothers Construction, one of the largest construction companies in the Middle East.

According to White, Bath told him that he had assisted the CIA in a liaison role with Saudi Arabia since 1976. Bath has previously denied having worked for the CIA.

In a sworn deposition, Bath said he was the sole director of Skyway Aircraft Leasing Ltd., a company that a court document shows is owned by Khaled bin Mahfouz. Bin Mahfouz had been a major shareholder in the Bank of Credit and Commerce International, a banking empire that has been accused of money laundering and of using Mideast oil money to seek ties to political leaders in several countries. Mahfouz and his family own the National Commercial Bank of Saudi Arabia.

In 1990, Bath bought the Express Auto Park garage at Hobby Airport for $ 8.4 million, which included a $ 1.4 million loan provided by Mahfouz, according to transaction documents. Bath received a 5 percent interest in the companies that own and operate Houston Gulf Airport after purchasing it on behalf of Binladen in 1977. After Binladen died in 1988, his interests in the airport were taken over by Mahfouz, according to court documents.


A Letter To President Clinton

Dear C.D. Sludge,

Would you please ask Sludge to read this very brief letter sent to President Clinton by a Dr Richard Duncan from Princeton in 1998, and the equally brief reply from Jessie Helms. These letters will add another twist to his plot.


Richard Duncan's, 1997 letter to President Clinton.

President William J. Clinton
The White House
1600 Pennsylvania Avenue NW
Washington, DC 20500

Dear President Clinton:

Re. US National Security Threatened by a New Alliance of Muslim Petroleum Exporting Countries (“AMPEC”)

As you know, we Americans now import more than 50% of the petroleum we use. In fact, in 1995 18% of our imports came from the Muslim Middle East alone, and 27% from all the Muslim exporting countries.

Moreover, in 1995 40% of Europe’s petroleum imports came from the Middle East, and 58% from the Muslim exporting countries. In Japan, 77% came from the Middle East, and 92% from the Muslim exporting countries.

The percentage of World petroleum exports from Muslim countries will, willy-nilly, continue to increase until (perhaps by 2010) the Muslim countries will control nearly 100% of the World’s petroleum exports. This situation was revealed in my study, “The World Petroleum Life-Cycle: Encircling the Production Peak,” presented on 9 May 1997 at Princeton University. See especially Figures 2-4 (to be published in the 1997 Space Studies Institute Conference Proceedings - Attachment #1).

Significantly, after reading my SSI paper — a French petroleum geologist called and requested a forecast of the year that the petroleum production of the World’s 19 Muslim countries will exceed the production of all 181 non-Muslim countries. Per my forecast, this ‘cross-over’ will occur in 1999 (Attachment #2).

At Princeton, I gave the following “Thought Experiment”:

What if tomorrow Palestinian leader Yasir Arafat met with representatives from each of the 19 Muslim petroleum exporting countries and proposed an entirely new organization called the “Alliance of Muslim Petroleum Exporting Nations” — “AMPEC” for short?

This proposal alone could cause World stock markets to fall 50% in one day. And crucially, it could ignite both (1) a World Petroleum War, and (2) a World Holy War (called a “Jihad” by Muslims). I view an “AMPEC shock” as looming likely because powerful Muslim forces are pushing Mr. Arafat (and others) further every day.

Please be advised.


Richard C. Duncan, Ph.D.

Institute on Energy and Man

Attachments (2)


June 2, 1997

Dr. Richard Duncan

Seattle, WA 98105

Dear Dr. Duncan:

Thank you for your letter concerning the United States' dependence on foreign oil.

I am very concerned by the extent to which the United States has become dependent on foreign countries to supply its energy needs. The Commerce Department recently released a report which found that U.S. dependence on foreign oil has become a threat to national security. The government should not have allowed its national security to be placed in such a vulnerable position.

During the 104th Congress, the Senate Foreign Relations Committee held a hearing to focus attention on this issue. The hearing also addressed how the United States should develop natural resources to prevent an international crisis from interrupting our energy supply. I continue to monitor this critical issue, and will hold additional hearings as developments warrant.

Thank you very much for writing about this important matter.


Signed Jesse Helms





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