‘‘Ukraine Freedom Support Act of 2014’’–S.R.2828

‘‘Ukraine Freedom Support Act of 2014’’

 

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113TH CONGRESS
2D SESSION S. ll
To impose sanctions with respect to the Russian Federation, to provide
additional assistance to Ukraine, and for other purposes.
IN THE SENATE OF THE UNITED STATES
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Mr. MENENDEZ (for himself and Mr. CORKER) introduced the following bill;
which was read twice and referred to the Committee on
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A BILL
To impose sanctions with respect to the Russian Federation,
to provide additional assistance to Ukraine, and for other
purposes.
1 Be it enacted by the Senate and House of Representa2
tives of the United States of America in Congress assembled,
3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
4 (a) SHORT TITLE.—This Act may be cited as the
5 ‘‘Ukraine Freedom Support Act of 2014’’.
6 (b) TABLE OF CONTENTS.—The table of contents for
7 this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Definitions.
Sec. 3. Statement of policy regarding Ukraine.
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Sec. 4. Sanctions relating to the defense and energy sectors of the Russian
Federation.
Sec. 5. Sanctions on Russian and other foreign financial institutions.
Sec. 6. Codification of executive orders addressing the crisis in Ukraine.
Sec. 7. Major non-NATO ally status for Ukraine, Georgia, and Moldova.
Sec. 8. Increased military assistance for the Government of Ukraine.
Sec. 9. Expanded nonmilitary assistance for Ukraine.
Sec. 10. Expanded broadcasting in countries of the former Soviet Union.
1 SEC. 2. DEFINITIONS.
2 In this Act:
3 (1) ACCOUNT; CORRESPONDENT ACCOUNT; PAY4
ABLE-THROUGH ACCOUNT.—The terms ‘‘account’’,
5 ‘‘correspondent account’’, and ‘‘payable-through ac6
count’’ have the meanings given those terms in sec7
tion 5318A of title 31, United States Code.
8 (2) APPROPRIATE CONGRESSIONAL COMMIT9
TEES.—The term ‘‘appropriate congressional com10
mittees’’ means—
11 (A) the Committee on Foreign Relations
12 and the Committee on Banking, Housing, and
13 Urban Affairs of the Senate; and
14 (B) the Committee on Foreign Affairs and
15 the Committee on Financial Services of the
16 House of Representatives.
17 (3) CONTROL.—The term ‘‘control’’ means—
18 (A) in the case of a corporation, to hold at
19 least 50 percent (by vote or value) of the capital
20 structure of the corporation; or
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1 (B) in the case of any other entity, to hold
2 interests representing at least 50 percent of the
3 capital structure of the entity.
4 (4) DEFENSE ARTICLE; DEFENSE SERVICE;
5 TRAINING.—The terms ‘‘defense article’’, ‘‘defense
6 service’’, and ‘‘training’’ have the meanings given
7 those terms in section 47 of the Arms Export Con8
trol Act (22 U.S.C. 2794).
9 (5) FINANCIAL INSTITUTION.—The term ‘‘fi10
nancial institution’’ means a financial institution
11 specified in subparagraph (A), (B), (C), (D), (E),
12 (F), (G), (H), (I), (J), (M), or (Y) of section
13 5312(a)(2) of title 31, United States Code.
14 (6) FOREIGN FINANCIAL INSTITUTION.—The
15 term ‘‘foreign financial institution’’ has the meaning
16 given that term in section 561.308 of title 31, Code
17 of Federal Regulations (or any corresponding similar
18 regulation or ruling).
19 (7) KNOWINGLY.—The term ‘‘knowingly’’, with
20 respect to conduct, a circumstance, or a result,
21 means that a person has actual knowledge, or should
22 have known, of the conduct, the circumstance, or the
23 result.
24 (8) NATIONAL.—The term ‘‘national’’ has the
25 meaning given that term in section 101(a) of the
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1 Immigration and Nationality Act (8 U.S.C.
2 1101(a)).
3 (9) PERSON.—The term ‘‘person’’ means—
4 (A) an individual;
5 (B) a corporation, business association,
6 partnership, society, trust, any other non7
governmental entity, organization, or group, or
8 any governmental entity operating as a business
9 enterprise; or
10 (C) any successor to any entity described
11 in subparagraph (B).
12 (10) RUSSIAN PERSON.—The term ‘‘Russian
13 person’’ means—
14 (A) an individual who is a citizen or na15
tional of the Russian Federation; or
16 (B) an entity organized under the laws of
17 the Russian Federation.
18 (11) SPECIAL RUSSIAN CRUDE OIL PROJECT.—
19 The term ‘‘special Russian crude oil project’’ means
20 a project intended to extract crude oil from—
21 (A) the exclusive economic zone of the
22 Russian Federation in waters more than 500
23 feet deep;
24 (B) Russian Arctic offshore locations; or
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1 (C) shale formations located in the Rus2
sian Federation.
3 (12) UNITED STATES PERSON.—The term
4 ‘‘United States person’’ means—
5 (A) a United States citizen or an alien law6
fully admitted for permanent residence to the
7 United States; or
8 (B) an entity organized under the laws of
9 the United States or of any jurisdiction within
10 the United States, including a foreign branch of
11 such an entity.
12 SEC. 3. STATEMENT OF POLICY REGARDING UKRAINE.
13 It is the policy of the United States to further assist
14 the Government of Ukraine in restoring its sovereignty
15 and territorial integrity to deter the Government of the
16 Russian Federation from further destabilizing and invad17
ing Ukraine and other independent countries in Eastern
18 Europe and Central Asia. That policy shall be carried into
19 effect, among other things, through a comprehensive ef20
fort, in coordination with allies and partners of the United
21 States where appropriate, that includes economic sanc22
tions, diplomacy, assistance for the people of Ukraine, and
23 the provision of military capabilities to the Government
24 of Ukraine that will enhance the ability of that Govern25
ment to defend itself and to restore its sovereignty and
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1 territorial integrity in the face of unlawful actions by the
2 Government of the Russian Federation.
3 SEC. 4. SANCTIONS RELATING TO THE DEFENSE AND EN4
ERGY SECTORS OF THE RUSSIAN FEDERA5
TION.
6 (a) SANCTIONS RELATING TO THE DEFENSE SEC7
TOR.—
8 (1) ROSOBORONEXPORT.—Except as provided
9 in subsection (d), not later than 30 days after the
10 date of the enactment of this Act, the President
11 shall impose 3 or more of the sanctions described in
12 subsection (c) with respect to Rosoboronexport.
13 (2) RUSSIAN PRODUCERS, TRANSFERORS, OR
14 BROKERS OF DEFENSE ARTICLES.—Except as pro15
vided in subsection (d), not later than 45 days after
16 the date of the enactment of this Act, the President
17 shall impose 3 or more of the sanctions described in
18 subsection (c) with respect to a person the President
19 determines—
20 (A) is an entity—
21 (i) owned by the Government of the
22 Russian Federation or controlled by na23
tionals of the Russian Federation; and
24 (ii) that—
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1 (I) manufactures or sells defense
2 articles transferred into Syria or into
3 the territory of a specified country
4 without the consent of the inter5
nationally recognized government of
6 that country;
7 (II) transfers defense articles
8 into Syria or into the territory of a
9 specified country without the consent
10 of the internationally recognized gov11
ernment of that country; or
12 (III) brokers or otherwise assists
13 in the transfer of defense articles into
14 Syria or into the territory of a speci15
fied country without the consent of
16 the internationally recognized govern17
ment of that country; or
18 (B) knowingly, on or after the date of the
19 enactment of this Act, assists, sponsors, or pro20
vides financial, material, or technological sup21
port for, or goods or services to or in support
22 of, an entity described in subparagraph (A)
23 with respect to an activity described in clause
24 (ii) of that subparagraph.
25 (3) SPECIFIED COUNTRY DEFINED.—
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1 (A) IN GENERAL.—In this subsection, the
2 term ‘‘specified country’’ means—
3 (i) Ukraine, Georgia, and Moldova;
4 and
5 (ii) any other country designated by
6 the President as a country of significant
7 concern for purposes of this subsection,
8 such as Poland, Lithuania, Latvia, Esto9
nia, and the Central Asia republics.
10 (B) NOTICE TO CONGRESS.—The Presi11
dent shall notify the appropriate congressional
12 committees in writing not later than 15 days
13 before—
14 (i) designating a country as a country
15 of significant concern under subparagraph
16 (A)(ii); or
17 (ii) terminating a designation under
18 that subparagraph, including the termi19
nation of any such designation pursuant to
20 subsection (g).
21 (b) SANCTIONS RELATED TO THE ENERGY SEC22
TOR.—
23 (1) DEVELOPMENT OF SPECIAL RUSSIAN
24 CRUDE OIL PROJECTS.—Except as provided in sub25
section (d), not later than 45 days after the date of
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1 the enactment of this Act, the President shall im2
pose 3 or more of the sanctions described in sub3
section (c) with respect to a person if the President
4 determines that the person knowingly makes a sig5
nificant investment in a special Russian crude oil
6 project.
7 (2) AUTHORIZATION FOR EXTENSION OF LI8
CENSING LIMITATIONS ON CERTAIN EQUIPMENT.—
9 The President, through the Bureau of Industry and
10 Security of the Department of Commerce or the Of11
fice of Foreign Assets Control of the Department of
12 the Treasury, as appropriate, may impose additional
13 licensing requirements for or other restrictions on
14 the export or reexport of items for use in the energy
15 sector of the Russian Federation, including equip16
ment used for tertiary oil recovery.
17 (3) CONTINGENT SANCTION RELATING TO
18 GAZPROM.—If the President determines that
19 Gazprom is withholding significant natural gas sup20
plies from member countries of the North Atlantic
21 Treaty Organization, or further withholds significant
22 natural gas supplies from countries such as Ukraine,
23 Georgia, or Moldova, the President shall, not later
24 than 45 days after making that determination, im25
pose the sanction described in subsection (c)(7) and
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1 at least one additional sanction described in sub2
section (c) with respect to Gazprom.
3 (c) SANCTIONS DESCRIBED.—The sanctions the
4 President may impose with respect to a foreign person
5 under subsection (a) or (b) are the following:
6 (1) EXPORT-IMPORT BANK ASSISTANCE.—The
7 President may direct the Export-Import Bank of the
8 United States not to approve the issuance of any
9 guarantee, insurance, extension of credit, or partici10
pation in the extension of credit in connection with
11 the export of any goods or services to the foreign
12 person.
13 (2) PROCUREMENT SANCTION.—The President
14 may prohibit the head of any executive agency (as
15 defined in section 133 of title 41, United States
16 Code) from entering into any contract for the pro17
curement of any goods or services from the foreign
18 person.
19 (3) ARMS EXPORT PROHIBITION.—The Presi20
dent may prohibit the exportation or provision by
21 sale, lease or loan, grant, or other means, directly or
22 indirectly, of any defense article or defense service to
23 the foreign person and the issuance of any license or
24 other approval to the foreign person under section
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1 38 of the Arms Export Control Act (22 U.S.C.
2 2778).
3 (4) DUAL-USE EXPORT PROHIBITION.—The
4 President may prohibit the issuance of any license
5 and suspend any license for the transfer to the for6
eign person of any item the export of which is con7
trolled under the Export Administration Act of 1979
8 (50 U.S.C. App. 2401 et seq.) (as in effect pursuant
9 to the International Emergency Economic Powers
10 Act (50 U.S.C. 1701 et seq.)) or the Export Admin11
istration Regulations under subchapter C of chapter
12 VII of title 15, Code of Federal Regulations.
13 (5) PROPERTY TRANSACTIONS.—The President
14 may, pursuant to such regulations as the President
15 may prescribe, prohibit any person from—
16 (A) acquiring, holding, withholding, using,
17 transferring, withdrawing, transporting, or ex18
porting any property that is subject to the ju19
risdiction of the United States and with respect
20 to which the foreign person has any interest;
21 (B) dealing in or exercising any right,
22 power, or privilege with respect to such prop23
erty; or
24 (C) conducting any transaction involving
25 such property.
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1 (6) BANKING TRANSACTIONS.—The President
2 may, pursuant to such regulations as the President
3 may prescribe, prohibit any transfers of credit or
4 payments between financial institutions or by,
5 through, or to any financial institution, to the extent
6 that such transfers or payments are subject to the
7 jurisdiction of the United States and involve any in8
terest of the foreign person.
9 (7) PROHIBITION ON INVESTMENT IN EQUITY
10 OR DEBT OF SANCTIONED PERSON.—The President
11 may, pursuant to such regulations as the President
12 may prescribe, prohibit any United States person
13 from investing in or purchasing significant amounts
14 of equity or debt instruments of the foreign person.
15 (8) EXCLUSION FROM THE UNITED STATES
16 AND REVOCATION OF VISA OR OTHER DOCUMENTA17
TION.—In the case of a foreign person who is an in18
dividual, the President may direct the Secretary of
19 State to deny a visa to, and the Secretary of Home20
land Security to exclude from the United States, the
21 foreign person, subject to regulatory exceptions to
22 permit the United States to comply with the Agree23
ment regarding the Headquarters of the United Na24
tions, signed at Lake Success June 26, 1947, and
25 entered into force November 21, 1947, between the
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1 United Nations and the United States, or other ap2
plicable international obligations.
3 (9) SANCTIONS ON PRINCIPAL EXECUTIVE OF4
FICERS.—In the case of a foreign person that is an
5 entity, the President may impose on the principal
6 executive officer or officers of the foreign person, or
7 on individuals performing similar functions and with
8 similar authorities as such officer or officers, any of
9 the sanctions described in this subsection applicable
10 to individuals.
11 (d) EXCEPTIONS.—
12 (1) IMPORTATION OF GOODS.—
13 (A) IN GENERAL.—The authority to block
14 and prohibit all transactions in all property and
15 interests in property under subsection (c)(5)
16 shall not include the authority to impose sanc17
tions on the importation of goods.
18 (B) GOOD DEFINED.—In this paragraph,
19 the term ‘‘good’’ has the meaning given that
20 term in section 16 of the Export Administration
21 Act of 1979 (50 U.S.C. App. 2415) (as contin22
ued in effect pursuant to the International
23 Emergency Economic Powers Act (50 U.S.C.
24 1701 et seq.)).
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1 (2) ADDITIONAL EXCEPTIONS.—The President
2 shall not be required to apply or maintain the sanc3
tions under subsection (a) or (b)—
4 (A) in the case of procurement of defense
5 articles or defense services—
6 (i) under existing contracts or sub7
contracts, including the exercise of options
8 for production quantities to satisfy require9
ments essential to the national security of
10 the United States;
11 (ii) if the President determines in
12 writing that—
13 (I) the person to which the sanc14
tions would otherwise be applied is a
15 sole source supplier of the defense ar16
ticles or services;
17 (II) the defense articles or serv18
ices are essential;
19 (III) alternative sources are not
20 readily or reasonably available; and
21 (IV) the national interests of the
22 United States would be adversely af23
fected by the application or mainte24
nance of such sanctions; or
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1 (iii) if the President determines in
2 writing that—
3 (I) such articles or services are
4 essential to the national security
5 under defense coproduction agree6
ments; and
7 (II) the national interests of the
8 United States would be adversely af9
fected by the application or mainte10
nance of such sanctions;
11 (B) in the case of procurement, to eligible
12 products, as defined in section 308(4) of the
13 Trade Agreements Act of 1979 (19 U.S.C.
14 2518(4)), of any foreign country or instrumen15
tality designated under section 301(b)(1) of
16 that Act (19 U.S.C. 2511(b)(1));
17 (C) to products, technology, or services
18 provided under contracts entered into before the
19 date on which the President publishes in the
20 Federal Register the name of the person with
21 respect to which the sanctions are to be im22
posed;
23 (D) to—
24 (i) spare parts that are essential to
25 United States products or production;
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1 (ii) component parts, but not finished
2 products, essential to United States prod3
ucts or production; or
4 (iii) routine servicing and mainte5
nance of United States products, to the ex6
tent that alternative sources are not read7
ily or reasonably available;
8 (E) to information and technology essential
9 to United States products or production; or
10 (F) to food, medicine, medical devices, or
11 agricultural commodities (as those terms are
12 defined in section 101 of the Comprehensive
13 Iran Sanctions, Accountability, and Divestment
14 Act of 2010 (22 U.S.C. 8511)).
15 (e) NATIONAL SECURITY WAIVER.—
16 (1) IN GENERAL.—The President may waive
17 the application of sanctions under subsection (a) or
18 (b) with respect to a person if the President—
19 (A) determines that the waiver is in the
20 national security interest of the United States;
21 and
22 (B) submits to the appropriate congres23
sional committees a report on the determination
24 and the reasons for the determination.
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1 (2) FORM OF REPORT.—The report required by
2 paragraph (1)(B) shall be submitted in unclassified
3 form, but may include a classified annex.
4 (f) TRANSACTION-SPECIFIC NATIONAL SECURITY
5 WAIVER.—
6 (1) IN GENERAL.—The President may waive
7 the application of sanctions under subsection (a) or
8 (b) with respect to a specific transaction if the
9 President—
10 (A) determines that the transaction is in
11 the national security interest of the United
12 States; and
13 (B) submits to the appropriate congres14
sional committees a detailed report on the de15
termination and the specific reasons for the de16
termination that a waiver with respect to the
17 transaction is necessary and appropriate.
18 (2) FORM OF REPORT.—The report required by
19 paragraph (1)(B) shall be submitted in unclassified
20 form, but may include a classified annex.
21 (g) PENALTIES.—The penalties provided for in sub22
sections (b) and (c) of section 206 of the International
23 Emergency Economic Powers Act (50 U.S.C. 1705) shall
24 apply to a person that violates, attempts to violate, or con25
spires to violate, or causes a violation of, subsection (a)
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1 or (b) of this section, or an order or regulation prescribed
2 under either such subsection, to the same extent that such
3 penalties apply to a person that commits an unlawful act
4 described in section 206(a) of the International Emer5
gency Economic Powers Act.
6 (h) TERMINATION.—This section, and sanctions im7
posed under this section, shall terminate on the date on
8 which the President submits to the appropriate congres9
sional committees a certification that the Government of
10 the Russian Federation has ceased ordering, controlling,
11 or otherwise directing, supporting, or financing, signifi12
cant acts intended to undermine the peace, security, sta13
bility, sovereignty, or territorial integrity of Ukraine,
14 Georgia, and Moldova.
15 SEC. 5. SANCTIONS ON RUSSIAN AND OTHER FOREIGN FI16
NANCIAL INSTITUTIONS.
17 (a) FACILITATION OF CERTAIN DEFENSE- AND EN18
ERGY-RELATED TRANSACTIONS.—The President may im19
pose the sanction described in subsection (c) with respect
20 to a foreign financial institution that the President deter21
mines engages, on or after the date of the enactment of
22 this Act, in significant transactions involving—
23 (1) persons with respect to which sanctions are
24 imposed under section 4; and
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1 (2) activities described in subsection (a) or (b)
2 of that section.
3 (b) FACILITATION OF FINANCIAL TRANSACTIONS ON
4 BEHALF OF SPECIALLY DESIGNATED NATIONALS.—The
5 President may impose the sanction described in subsection
6 (c) with respect to a foreign financial institution if the
7 President determines that the foreign financial institution
8 has, on or after the date that is 180 days after the date
9 of the enactment of this Act, knowingly facilitated a sig10
nificant financial transaction on behalf of any Russian
11 person included on the list of specially designated nation12
als and blocked persons maintained by the Office of For13
eign Assets Control of the Department of the Treasury,
14 pursuant to—
15 (1) this Act;
16 (2) Executive Order 13660 (79 Fed. Reg.
17 13,493), 13661 (79 Fed. Reg. 15,535), or 13662
18 (79 Fed. Reg. 16,169); or
19 (3) any other executive order addressing the
20 crisis in Ukraine.
21 (c) SANCTION DESCRIBED.—The sanction described
22 in this subsection is, with respect to a foreign financial
23 institution, a prohibition on the opening, and a prohibition
24 or the imposition of strict conditions on the maintaining,
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1 in the United States of a correspondent account or a pay2
able-through account by the foreign financial institution.
3 (d) NATIONAL SECURITY WAIVER.—The President
4 may waive the application of sanctions under this section
5 with respect to a foreign financial institution if the Presi6
dent—
7 (1) determines that the waiver is in the national
8 security interest of the United States; and
9 (2) submits to the appropriate congressional
10 committees a report on the determination and the
11 reasons for the determination.
12 (e) TERMINATION.—This section, and sanctions im13
posed under this section, shall terminate on the date on
14 which the President submits to the appropriate congres15
sional committees the certification described in section
16 4(h).
17 SEC. 6. CODIFICATION OF EXECUTIVE ORDERS ADDRESS18
ING THE CRISIS IN UKRAINE.
19 United States sanctions with respect to the Russian
20 Federation provided for in Executive Orders 13660 (79
21 Fed. Reg. 13,493), 13661 (79 Fed. Reg. 15,535), and
22 13662 (79 Fed. Reg. 16,169), as in effect on the day be23
fore the date of the enactment of this Act, shall remain
24 in effect until the date on which the President submits
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1 to the appropriate congressional committees the certifi2
cation described in section 4(h).
3 SEC. 7. MAJOR NON-NATO ALLY STATUS FOR UKRAINE,
4 GEORGIA, AND MOLDOVA.
5 Section 517 of the Foreign Assistance Act of 1961
6 (22 U.S.C. 2321k) is amended by adding at the end the
7 following:
8 ‘‘(c) ADDITIONAL DESIGNATIONS.—
9 ‘‘(1) IN GENERAL.—Effective on the date of the
10 enactment of the Ukraine Freedom Support Act of
11 2014, Ukraine, Georgia, and Moldova are each des12
ignated as a major non-NATO ally for purposes of
13 this Act and the Arms Export Control Act (22
14 U.S.C. 2751 et seq.).
15 ‘‘(2) NOTICE OF TERMINATION OF DESIGNA16
TION.—The President shall notify Congress in ac17
cordance with subsection (a)(2) before terminating
18 the designation of a country specified in paragraph
19 (1).’’.
20 SEC. 8. INCREASED MILITARY ASSISTANCE FOR THE GOV21
ERNMENT OF UKRAINE.
22 (a) IN GENERAL.—The President is authorized to
23 provide defense articles, defense services, and training to
24 the Government of Ukraine for the purpose of countering
25 offensive weapons and reestablishing the sovereignty and
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1 territorial integrity of Ukraine, including anti-tank and
2 anti-armor weapons, crew weapons and ammunition,
3 counter-artillery radars to identify and target artillery bat4
teries, fire control, range finder, and optical and guidance
5 and control equipment, tactical troop-operated surveillance
6 drones, and secure command and communications equip7
ment, pursuant to the provisions of the Arms Export Con8
trol Act (22 U.S.C. 2751 et seq.), the Foreign Assistance
9 Act of 1961 (22 U.S.C. 2151 et seq.), and other relevant
10 provisions of law.
11 (b) REPORT REQUIRED.—Not later than 60 days
12 after the date of the enactment of this Act, the President
13 shall submit a report detailing the anticipated defense ar14
ticles, defense services, and training to be provided pursu15
ant to this section and a timeline for the provision of such
16 defense articles, defense services, and training, to—
17 (1) the Committee on Foreign Relations, the
18 Committee on Appropriations, and the Committee on
19 Armed Services of the Senate; and
20 (2) the Committee on Foreign Affairs, the
21 Committee on Appropriations, and the Committee on
22 Armed Services of the House of Representatives.
23 (c) AUTHORIZATION OF APPROPRIATIONS.—
24 (1) IN GENERAL.—There are authorized to be
25 appropriated to the Secretary of State $350,000,000
23
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1 for fiscal year 2015 to carry out activities under this
2 section.
3 (2) AVAILABILITY OF AMOUNTS.—Amounts au4
thorized to be appropriated pursuant to paragraph
5 (1) shall remain available for obligation and expendi6
ture through the end of fiscal year 2017.
7 (d) AUTHORITY FOR THE USE OF FUNDS.—The
8 funds made available pursuant to subsection (c) for provi9
sion of defense articles, defense services, and training may
10 be used to procure such articles, services, and training
11 from the United States Government or other appropriate
12 sources.
13 SEC. 9. EXPANDED NONMILITARY ASSISTANCE FOR
14 UKRAINE.
15 (a) ASSISTANCE TO INTERNALLY DISPLACED PEO16
PLE IN UKRAINE.—
17 (1) IN GENERAL.—Not later than 30 days after
18 the date of the enactment of this Act, the Secretary
19 of State shall submit a plan, including actions by the
20 United States Government, other governments, and
21 international organizations, to meet the need for
22 protection of and assistance for internally displaced
23 persons in Ukraine, to—
24 (A) the Committee on Foreign Relations,
25 the Committee on Appropriations, and the
24
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1 Committee on Energy and Natural Resources of
2 the Senate; and
3 (B) the Committee on Foreign Affairs, the
4 Committee on Appropriations, and the Com5
mittee on Energy and Commerce of the House
6 of Representatives.
7 (2) ELEMENTS.—The plan required by para8
graph (1) should include, as appropriate, activities
9 in support of—
10 (A) helping to establish a functional and
11 adequately resourced central registration system
12 in Ukraine that can ensure coordination of ef13
forts to provide assistance to internally dis14
placed persons in different regions;
15 (B) encouraging adoption of legislation in
16 Ukraine that protects internally displaced per17
sons from discrimination based on their status
18 and provides simplified procedures for obtaining
19 the new residency registration or other official
20 documentation that is a prerequisite to receiv21
ing appropriate social payments under the laws
22 of Ukraine, such as pensions, and disability,
23 child, and unemployment benefits; and
25
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1 (C) helping to ensure that information is
2 available to internally displaced persons
3 about—
4 (i) government agencies and inde5
pendent groups that can provide assistance
6 to such persons in various regions; and
7 (ii) evacuation assistance available to
8 persons seeking to flee armed conflict
9 areas.
10 (3) ASSISTANCE THROUGH INTERNATIONAL OR11
GANIZATIONS.—The President shall instruct the
12 United States permanent representative or executive
13 director, as the case may be, to the relevant United
14 Nations voluntary agencies, including the United
15 Nations High Commissioner for Refugees and the
16 United Nations Office for the Coordination of Hu17
manitarian Affairs, and other appropriate inter18
national organizations, to use the voice and vote of
19 the United States to support appropriate assistance
20 for internally displaced persons in Ukraine.
21 (b) ASSISTANCE TO THE DEFENSE SECTOR OF
22 UKRAINE.—The Secretary of State and the Secretary of
23 Defense should assist entities in the defense sector of
24 Ukraine to reorient exports away from customers in the
25 Russian Federation and to find appropriate alternative
26
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1 markets for those entities in the defense sector of Ukraine
2 that have already significantly reduced exports to and co3
operation with entities in the defense sector of the Russian
4 Federation.
5 (c) ASSISTANCE TO ADDRESS THE ENERGY CRISIS
6 IN UKRAINE.—
7 (1) EMERGENCY ENERGY ASSISTANCE.—
8 (A) PLAN REQUIRED.—The Secretary of
9 State and the Secretary of Energy, in collabora10
tion with the Administrator of the United
11 States Agency for International Development
12 and the Administrator of the Federal Emer13
gency Management Agency, shall work with of14
ficials of the Government of Ukraine to develop
15 a short-term emergency energy assistance plan
16 designed to help Ukraine address the poten17
tially severe short-term, heating fuel and elec18
tricity shortages facing Ukraine in 2014 and
19 2015.
20 (B) ELEMENTS.—The plan required by
21 subparagraph (A) should include strategies to
22 address heating fuel and electricity shortages in
23 Ukraine, including, as appropriate—
24 (i) the acquisition of short-term,
25 emergency fuel supplies;
27
MRW14623 S.L.C.
1 (ii) the repair or replacement of infra2
structure that could impede the trans3
mission of electricity or transportation of
4 fuel;
5 (iii) the prioritization of the transpor6
tation of fuel supplies to the areas where
7 such supplies are needed most;
8 (iv) streamlining emergency commu9
nications throughout national, regional,
10 and local governments to manage the po11
tential energy crisis resulting from heating
12 fuel and electricity shortages;
13 (v) forming a crisis management team
14 within the Government of Ukraine to spe15
cifically address the potential crisis, includ16
ing ensuring coordination of the team’s ef17
forts with the efforts of outside govern18
mental and nongovernmental entities pro19
viding assistance to address the potential
20 crisis; and
21 (vi) developing a public outreach
22 strategy to facilitate preparation by the
23 population and communication with the
24 population in the event of a crisis.
28
MRW14623 S.L.C.
1 (C) ASSISTANCE.—The Secretary of State,
2 the Secretary of Energy, and the Administrator
3 of the United States Agency for International
4 Development are authorized to provide assist5
ance in support of, and to invest in short-term
6 solutions for, enabling Ukraine to secure the
7 energy safety of the people of Ukraine during
8 2014 and 2015, including through—
9 (i) procurement and transport of
10 emergency fuel supplies, including reverse
11 pipeline flows from Europe;
12 (ii) provision of technical assistance
13 for crisis planning, crisis response, and
14 public outreach;
15 (iii) repair of infrastructure to enable
16 the transport of fuel supplies;
17 (iv) repair of power generating or
18 power transmission equipment or facilities;
19 (v) procurement and installation of
20 compressors or other appropriate equip21
ment to enhance short-term natural gas
22 production;
23 (vi) procurement of mobile electricity
24 generation units; and
29
MRW14623 S.L.C.
1 (vii) conversion of natural gas heating
2 facilities to run on other fuels, including
3 alternative energy sources.
4 (D) AUTHORIZATION OF APPROPRIA5
TIONS.—There are authorized to be appro6
priated to the Secretary of State, the Secretary
7 of Energy, and the Administrator of the United
8 States Agency for International Development
9 $50,000,000 in the aggregate for fiscal year
10 2015 to carry out activities under this para11
graph.
12 (2) REDUCTION OF UKRAINE’S RELIANCE ON
13 ENERGY IMPORTS.—
14 (A) PLANS REQUIRED.—The Secretary of
15 State, in collaboration with the Secretary of
16 Energy and the Administrator of the United
17 States Agency for International Development,
18 shall work with officials of the Government of
19 Ukraine to develop medium- and long-term
20 plans to increase energy production and effi21
ciency to increase energy security by helping
22 Ukraine reduce its dependence on natural gas
23 imported from the Russian Federation.
30
MRW14623 S.L.C.
1 (B) ELEMENTS.—The medium- and long2
term plans required by subparagraph (A)
3 should include strategies, as appropriate, to—
4 (i) improve corporate governance and
5 unbundling of state-owned oil and gas sec6
tor firms;
7 (ii) increase production from natural
8 gas fields and from other sources, includ9
ing renewable energy;
10 (iii) license new oil and gas blocks
11 transparently and competitively;
12 (iv) modernize oil and gas upstream
13 infrastructure; and
14 (v) improve energy efficiency.
15 (C) PRIORITIZATION.—The Secretary of
16 State, the Administrator of the United States
17 Agency for International Development, and the
18 Secretary of Energy should, during fiscal years
19 2015 through 2017, work with other donors, in20
cluding multilateral agencies and nongovern21
mental organizations, to prioritize, to the extent
22 practicable and as appropriate, the provision of
23 assistance from such donors to help Ukraine to
24 improve energy efficiency, increase energy sup25
plies produced in Ukraine, and reduce reliance
31
MRW14623 S.L.C.
1 on energy imports from the Russian Federa2
tion, including natural gas.
3 (D) AUTHORIZATION OF APPROPRIA4
TIONS.—There are authorized to be appro5
priated $50,000,000 in the aggregate for fiscal
6 years 2015 through 2017 to carry out activities
7 under this paragraph.
8 (3) SUPPORT FROM THE OVERSEAS PRIVATE
9 INVESTMENT CORPORATION.—The Overseas Private
10 Investment Corporation shall—
11 (A) prioritize, to the extent practicable,
12 support for investments to help increase energy
13 efficiency, develop domestic oil and natural gas
14 reserves, improve and repair electricity infra15
structure, and develop renewable and other
16 sources of energy in Ukraine; and
17 (B) implement procedures for expedited re18
view and, as appropriate, approval, of applica19
tions by eligible investors (as defined in section
20 238 of the Foreign Assistance Act of 1961 (22
21 U.S.C. 2198)) for loans, loan guarantees, and
22 insurance for such investments.
23 (4) SUPPORT BY THE WORLD BANK GROUP AND
24 THE EUROPEAN BANK FOR RECONSTRUCTION AND
25 DEVELOPMENT.—The President shall, to the extent
32
MRW14623 S.L.C.
1 practicable and as appropriate, direct the United
2 States Executive Directors of the World Bank
3 Group and the European Bank for Reconstruction
4 and Development to use the voice, vote, and influ5
ence of the United States to encourage the World
6 Bank Group and the European Bank for Recon7
struction and Development and other international
8 financial institutions—
9 (A) to invest in, and increase their efforts
10 to promote investment in, projects to improve
11 energy efficiency, improve and repair electricity
12 infrastructure, develop domestic oil and natural
13 gas reserves, and develop renewable and other
14 sources of energy in Ukraine; and
15 (B) to stimulate private investment in such
16 projects.
17 (d) ASSISTANCE TO CIVIL SOCIETY IN UKRAINE.—
18 (1) IN GENERAL.—The Secretary of State and
19 the Administrator of the United States Agency for
20 International Development shall, directly or through
21 nongovernmental or international organizations—
22 (A) strengthen the organizational and
23 operational capacity of democratic civil society
24 in Ukraine;
33
MRW14623 S.L.C.
1 (B) support the efforts of independent
2 media outlets to broadcast, distribute, and
3 share information in all regions of Ukraine;
4 (C) counter corruption and improve trans5
parency and accountability of institutions that
6 are part of the Government of Ukraine; and
7 (D) provide support for democratic orga8
nizing and election monitoring in Ukraine.
9 (2) STRATEGY REQUIRED.—Not later than 60
10 days after the date of the enactment of this Act, the
11 President shall submit a strategy to carry out the
12 activities described in paragraph (1) to the commit13
tees specified in subsection (a)(1).
14 (3) AUTHORIZATION OF APPROPRIATIONS.—
15 There are authorized to be appropriated to the Sec16
retary of State $20,000,000 for fiscal year 2015 to
17 carry out this subsection.
18 SEC. 10. EXPANDED BROADCASTING IN COUNTRIES OF THE
19 FORMER SOVIET UNION.
20 (a) IN GENERAL.—Not later than 90 days after the
21 date of the enactment of this Act, the Chairman of the
22 Broadcasting Board of Governors shall submit to Con23
gress a plan, including a cost estimate, for immediately
24 and substantially increasing, and maintaining through fis25
cal year 2017, the quantity of Russian-language broad34
MRW14623 S.L.C.
1 casting into the countries of the former Soviet Union fund2
ed by the United States in order to counter Russian Fed3
eration propaganda.
4 (b) PRIORITIZATION OF BROADCASTING INTO
5 UKRAINE, GEORGIA, AND MOLDOVA.—The plan required
6 by subsection (a) shall prioritize broadcasting into
7 Ukraine, Georgia, and Moldova by the Voice of America
8 and Radio Free Europe/Radio Liberty.
9 (c) ADDITIONAL PRIORITIES.—In developing the plan
10 required by subsection (a), the Chairman shall consider—
11 (1) near-term increases in Russian-language
12 broadcasting for countries of the former Soviet
13 Union (other than the countries specified in sub14
section (b)), including Latvia, Lithuania, and Esto15
nia; and
16 (2) increases in broadcasting in other critical
17 languages, including Ukrainian and Romanian lan18
guages.
19 (d) BROADCASTING DEFINED.—In this section, the
20 term ‘‘broadcasting’’ means the distribution of media con21
tent via radio broadcasting, television broadcasting, and
22 Internet-based platforms, among other platforms.
23 (e) AUTHORIZATION OF APPROPRIATIONS.—
24 (1) IN GENERAL.—There are authorized to be
25 appropriated $10,000,000 for each of fiscal years
35
MRW14623 S.L.C.
1 2015 through 2017 to carry out activities under this
2 section.
3 (2) SUPPLEMENT NOT SUPPLANT.—Amounts
4 authorized to be appropriated pursuant to paragraph
5 (1) shall supplement and not supplant other
6 amounts made available for activities described in
7 this section.

If there was no American prison in Iraq, there would be no IS now. Bucca was a factory.

[SEE:  What is the truth about ISIS? ]

ISIS leader says US prisons in Iraq led to creation of terrorist organization

Russia-Today
isis-creation-prison-iraq.si

Some of the 180 high security prisoners walk in the exercise pitch at Camp Bucca on the outskirts of the southern city of Basra, 550 kms from Baghdad, on September 16, 2009. (AFP Photo)

A leading member of the Islamic State has revealed the group could never have been formed without the help of the US. American prison camps in Iraq gave the Islamists the perfect opportunity to meet and plan their eventual rise to power.

Ten years ago, Abu Ahmed was incarcerated at Camp Bucca, a US run prison in Iraq. In an exclusive interview a decade later to the Guardian, he reveals how the Islamic State (IS, formerly ISIS/ISIL) might never have formed if US detention centers hadn’t existed.

Abu Ahmed, who uses a pseudonym, is now one of the Islamic State’s senior leaders. He recalls how he initially feared going to Camp Bucca, but he soon realized he had arrived at a facility that was a hive of Islamist radicals.

“We could never have all got together like this in Baghdad, or anywhere else,” he told the Guardian. “It would have been impossibly dangerous. Here, we were not only safe, but we were only a few hundred meters away from the entire Al-Qaida leadership.”

The Iraqi government estimates that 17 of the most important IS leaders spent time in US prison’s from 2004-11, the Guardian reported. The inmates were released at different times and were spread across the country. However, they came-up with an ingenious way to stay in touch after being granted their freedom. They would write each other’s telephone numbers and addresses on the inside of their boxer shorts, as they had no access to paper or other electronic aids.

READ MORE: RT exclusive: From London banker to ISIS militant – one man’s terror trail

After Abu Ahmed was released, the first thing he did when he was safe in Baghdad was to undress, then carefully take a pair of scissors to his underwear and cut away the elastic where everything was written down. “I cut the fabric from my boxers and all the numbers were there. We reconnected. And we got to work.” Across Iraq, other ex-inmates were doing the same. “It really was that simple,” Abu Ahmed said, as he recalled how his captors had been outwitted. “Boxers helped us win the war.”

Islamic State (IS) jihadist group Abu Bakr al-Baghdadi (AFP Photo)

Islamic State (IS) jihadist group Abu Bakr al-Baghdadi (AFP Photo)

During his time at Camp Bucca, Abu Ahmed also came face to face with the current IS leader, Abu Bakr Al-Baghdadi. He says Al-Baghdadi proved he had a direct lineage to the Prophet Mohammed and also had a PhD in Islamic studies from the University of Baghdad, which played a key role in being able to maneuver himself into a position of power.

“Baghdadi was a quiet person. He had a charisma. You could feel that he was someone important. But there were others who were more important. I honestly did not think he would get this far,” Abu Ahmed told the Guardian.

READ MORE: ISIS leader’s call to Muslims: Go to Iraq and Syria ‘to help build Islamic state’

“The Americans never knew who they had,” Abu Ahmed continued, speaking of Al-Baghdadi. However, the US army was not alone as most of Baghdadi’s fellow prisoners – some 24,000 men, divided into 24 camps – seem to have been equally unaware.

However, the current IS leader certainly managed to create a rapport with the US Army. He was often seen as a go-between to settle disputes between rival factions in the prison camp.

“But as time went on, every time there was a problem in the camp, he was at the center of it. He wanted to be the head of the prison – and when I look back now, he was using a policy of conquer and divide to get what he wanted, which was status. And it worked.”

AFP/ISIL

AFP/ISIL

READ MORE: Pentagon cannot confirm if ISIS leader al-Baghdadi wounded in airstrike

By December 2004, Baghdadi was deemed by his jailers to pose no further risk and his release was authorized. He eventually left Camp Bucca in 2009.

“He was respected very much by the US army,” Abu Ahmed said. “If he wanted to visit people in another camp he could, but we couldn’t. And all the while, a new strategy, which he was leading, was rising under their noses, and that was to build the Islamic State. If there was no American prison in Iraq, there would be no IS now. Bucca was a factory. It made us all. It built our ideology.”

Camp Bucca was one of a number of US prisons in Iraq, but the most infamous was Abu Ghraib, which closed in April.

It came to international attention in early 2004, when it was revealed that US troops physically and sexually abused, tortured, raped, and killed inmates. The disturbing images that came out of the facility went a long way to fueling Iraqi fury with American forces, and forever changed the perception of the war.

Hundreds of prisoners escaped from Abu Ghraib last year when nearby Fallujah fell under the control of the Islamic State. An attack on Abu Ghraib and Taji prisons freed more than 500 prisoners, including a number of senior militants and killed 120 Iraqi guards and SWAT forces, an Al-Qaeda spokesman told reporters last year.

Americans Don’t Have the Balls To Torture the Truth

CIA boosters weigh in: Man up, America

sf gate

Report On CIA Interrogations To Be Released By Senate Intelligence Chair Sen. Dianne FeinsteinThe Senate torture report has inspired reams of reporting, most of it supportive or at least non-critical. An tide of editorials here, here and here have matched the tone of our own. Sen Dianne Feinstein is the hero of the hour to long time observers.
But now on Day Two the defenders have emerged to criticize the report and explain the past on their preferred terms. Three past CIA directors who presided over the torture years explained their actions in the friendly opinion pages of the Wall Street Journal, which added its own hardline editorial. The basic answer: torture –wait, make that enhanced interrogation techniques — worked, thousands of livers were saved, and the temperature at the time demanded tough stuff. Democrats back then wanted bold action, and who are they to complain now?

Present CIA director John Brennan — once Obama’s national security adviser — added his own toned down criticism. His take: mistakes were made, but we no longer do this stuff.
Then there’s the minority report from Republicans on the Democrat-dominated Intelligence Committee that produced the door-stopper 6,000 page still-secret report and the publicly released versions that’s created all the news. The GOP members picked at perceived flaws and noted that no interviews with CIA employees past or present were included to flesh out the claims built on e-mails, memos and printed communications.
Other voices are now surfacing. Former Nebraska Senator Bob Kerrey, a liberal Democrat who spent eight years on the Senate intelligence panel, doesn’t think it does any good to release the report without a unified forward action, which won’t happen now. Bush-era legal beagle John Yoo, a former Justice Department lawyer who helped write justifications for water boarding and the like, weighed in critically.
John McCain, the only member of Congress actually tortured after capture in North Vietnam, offered his thoughts too. He’s a longtime critic of torture, believing it has little value and taints the country’s image. He was the only Republican to speak out in favor of the Senate report’s dismal findings.

It’s hard to know what impact the graphic and gruesome Senate report will have on public opinion. Polls have repeatedly showed a majority of Americans support torture in the terrorism fight. Maybe this time that perception will change.

John McCain Speech Against Torture, In Defense of the Rights of All Men

FLOOR STATEMENT BY SENATOR JOHN McCAIN ON SENATE INTELLIGENCE COMMITTEE REPORT ON CIA INTERROGATION METHODS

Dec 09 2014

Washington, D.C. ­– U.S. Senator John McCain (R-AZ) today delivered the following statement on the floor of the U.S. Senate on the Senate Select Committee on Intelligence report on CIA interrogation methods:

“Mr. President, I rise in support of the release – the long-delayed release – of the Senate Intelligence Committee’s summarized, unclassified review of the so-called ‘enhanced interrogation techniques’ that were employed by the previous administration to extract information from captured terrorists. It is a thorough and thoughtful study of practices that I believe not only failed their purpose – to secure actionable intelligence to prevent further attacks on the U.S. and our allies – but actually damaged our security interests, as well as our reputation as a force for good in the world.

“I believe the American people have a right – indeed, a responsibility – to know what was done in their name; how these practices did or did not serve our interests; and how they comported with our most important values.

“I commend Chairman Feinstein and her staff for their diligence in seeking a truthful accounting of policies I hope we will never resort to again. I thank them for persevering against persistent opposition from many members of the intelligence community, from officials in two administrations, and from some of our colleagues.

“The truth is sometimes a hard pill to swallow. It sometimes causes us difficulties at home and abroad. It is sometimes used by our enemies in attempts to hurt us. But the American people are entitled to it, nonetheless.

“They must know when the values that define our nation are intentionally disregarded by our security policies, even those policies that are conducted in secret. They must be able to make informed judgments about whether those policies and the personnel who supported them were justified in compromising our values; whether they served a greater good; or whether, as I believe, they stained our national honor, did much harm and little practical good.

“What were the policies? What was their purpose? Did they achieve it? Did they make us safer? Less safe? Or did they make no difference? What did they gain us? What did they cost us? The American people need the answers to these questions. Yes, some things must be kept from public disclosure to protect clandestine operations, sources and methods, but not the answers to these questions.

“By providing them, the Committee has empowered the American people to come to their own decisions about whether we should have employed such practices in the past and whether we should consider permitting them in the future. This report strengthens self-government and, ultimately, I believe, America’s security and stature in the world. I thank the Committee for that valuable public service.

“I have long believed some of these practices amounted to torture, as a reasonable person would define it, especially, but not only the practice of waterboarding, which is a mock execution and an exquisite form of torture. Its use was shameful and unnecessary; and, contrary to assertions made by some of its defenders and as the Committee’s report makes clear, it produced little useful intelligence to help us track down the perpetrators of 9/11 or prevent new attacks and atrocities.

“I know from personal experience that the abuse of prisoners will produce more bad than good intelligence. I know that victims of torture will offer intentionally misleading information if they think their captors will believe it. I know they will say whatever they think their torturers want them to say if they believe it will stop their suffering. Most of all, I know the use of torture compromises that which most distinguishes us from our enemies, our belief that all people, even captured enemies, possess basic human rights, which are protected by international conventions the U.S. not only joined, but for the most part authored.

“I know, too, that bad things happen in war. I know in war good people can feel obliged for good reasons to do things they would normally object to and recoil from.

“I understand the reasons that governed the decision to resort to these interrogation methods, and I know that those who approved them and those who used them were dedicated to securing justice for the victims of terrorist attacks and to protecting Americans from further harm. I know their responsibilities were grave and urgent, and the strain of their duty was onerous.

“I respect their dedication and appreciate their dilemma. But I dispute wholeheartedly that it was right for them to use these methods, which this report makes clear were neither in the best interests of justice nor our security nor the ideals we have sacrificed so much blood and treasure to defend.

“The knowledge of torture’s dubious efficacy and my moral objections to the abuse of prisoners motivated my sponsorship of the Detainee Treatment Act of 2005, which prohibits ‘cruel, inhuman or degrading treatment’ of captured combatants, whether they wear a nation’s uniform or not, and which passed the Senate by a vote of 90-9.

“Subsequently, I successfully offered amendments to the Military Commissions Act of 2006, which, among other things, prevented the attempt to weaken Common Article 3 of the Geneva Conventions, and broadened definitions in the War Crimes Act to make the future use of waterboarding and other ‘enhanced interrogation techniques’ punishable as war crimes.

“There was considerable misinformation disseminated then about what was and wasn’t achieved using these methods in an effort to discourage support for the legislation. There was a good amount of misinformation used in 2011 to credit the use of these methods with the death of Osama bin Laden. And there is, I fear, misinformation being used today to prevent the release of this report, disputing its findings and warning about the security consequences of their public disclosure.

“Will the report’s release cause outrage that leads to violence in some parts of the Muslim world? Yes, I suppose that’s possible, perhaps likely. Sadly, violence needs little incentive in some quarters of the world today. But that doesn’t mean we will be telling the world something it will be shocked to learn. The entire world already knows that we water-boarded prisoners. It knows we subjected prisoners to various other types of degrading treatment. It knows we used black sites, secret prisons. Those practices haven’t been a secret for a decade.

“Terrorists might use the report’s re-identification of the practices as an excuse to attack Americans, but they hardly need an excuse for that. That has been their life’s calling for a while now.

“What might come as a surprise, not just to our enemies, but to many Americans, is how little these practices did to aid our efforts to bring 9/11 culprits to justice and to find and prevent terrorist attacks today and tomorrow. That could be a real surprise, since it contradicts the many assurances provided by intelligence officials on the record and in private that enhanced interrogation techniques were indispensable in the war against terrorism. And I suspect the objection of those same officials to the release of this report is really focused on that disclosure – torture’s ineffectiveness – because we gave up much in the expectation that torture would make us safer. Too much.

“Obviously, we need intelligence to defeat our enemies, but we need reliable intelligence. Torture produces more misleading information than actionable intelligence. And what the advocates of harsh and cruel interrogation methods have never established is that we couldn’t have gathered as good or more reliable intelligence from using humane methods.

“The most important lead we got in the search for bin Laden came from using conventional interrogation methods. I think it is an insult to the many intelligence officers who have acquired good intelligence without hurting or degrading prisoners to assert we can’t win this war without such methods. Yes, we can and we will.

“But in the end, torture’s failure to serve its intended purpose isn’t the main reason to oppose its use. I have often said, and will always maintain, that this question isn’t about our enemies; it’s about us. It’s about who we were, who we are and who we aspire to be. It’s about how we represent ourselves to the world.

“We have made our way in this often dangerous and cruel world, not by just strictly pursuing our geopolitical interests, but by exemplifying our political values, and influencing other nations to embrace them. When we fight to defend our security we fight also for an idea, not for a tribe or a twisted interpretation of an ancient religion or for a king, but for an idea that all men are endowed by the Creator with inalienable rights. How much safer the world would be if all nations believed the same. How much more dangerous it can become when we forget it ourselves even momentarily.

“Our enemies act without conscience. We must not. This executive summary of the Committee’s report makes clear that acting without conscience isn’t necessary, it isn’t even helpful, in winning this strange and long war we’re fighting. We should be grateful to have that truth affirmed.

“Now, let us reassert the contrary proposition: that is it essential to our success in this war that we ask those who fight it for us to remember at all times that they are defending a sacred ideal of how nations should be governed and conduct their relations with others – even our enemies.

“Those of us who give them this duty are obliged by history, by our nation’s highest ideals and the many terrible sacrifices made to protect them, by our respect for human dignity to make clear we need not risk our national honor to prevail in this or any war. We need only remember in the worst of times, through the chaos and terror of war, when facing cruelty, suffering and loss, that we are always Americans, and different, stronger, and better than those who would destroy us.

“Thank you.”

The Implosion of Shale-Oil Fracking Boom

That low rumble you hear to the west is the sound of the Bakken Shale Oil Bust. Bomb Trains and all.  First shale gas went from fracking boom to fracking bust. Now it’s shale oil’s turn to get fracked. Below about $75 a barrel, most US shale oil becomes unprofitable on a fully burdened basis. And oil is now at $70 bbl. That dog no hunt.

Look on the sunny side – the frackers will have to shut in those shale oil wells – and stop lighting the heavens with gas flares. And fewer neighborhoods will get torched by Shale Oil Terror Trains. As shale oil production is shut in, gas supplies from those fields will drop, which should boost natural gas prices a bit near the oil fields.

Take that Frackers !

Note, this recent drop is being billed in the popular press as a conspiracy by OPEC or the Russians, (or Green Billionaires ?) when the simple fact is that oil prices “revert to the mean” cost of production, which is a function of the world average cost of production. And the world average cost is about $40 Bbl. So the market is always at risk of playing the limbo down to that floor price – which is about half the cost of production of most US shale oil fields. No new conspiracy theory needed.

The shale oil bust was not only predictable, but was in fact predicted, by Art Berman, Deborah Lawrence, and others. 

The lowest cost oil or gas producers in the world will not give up market share to higher cost North American shale oil or gas. That is what is already happening on the international gas market – where US LNG exports cannot compete against Russian or Mideast gas pipelines – over which real wars are being fought. Not just commodity price wars.

Oil prices continued to crash yesterday after OPEC decided to not cut production.

Oil prices have fallen below $70 for the first time since 2010.

shale oil bust

Bakken Decline

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Bakken shale oil fields of North Dakota, the largest in the United States, is no longer economic and has already peaked. 

$80 oil is bad for the fracking companies, but $70 is a fracking disaster for most shale oil fields.

It isn’t just Bakken.

Few North American shale oil fields make money below $75 on a full cycle basis (lease cost, taxes, overhead, transport,P&A)

None are economic below $70 

Most fracking becomes a losing venture below the current oil price, and that’s a big deal. What we are probably looking at is a crash similar to when oil prices crashed in 1986.

Lower oil prices are good for consumers and industry, but it could be disastrous for the oil producing regions – which frack shill politicians – like Mississippi’s governor, bemoan.

There is another problem that also needs to be considered: fracking companies are generally been financed by issuing junk bonds. A lot of junk bonds.

The falling oil price will place stress on the global junk bond market, experts say, with US energy companies at increasing risk of default.
The plunge in the price is “the most significant risk that could potentially deliver a volatility shock large enough to trigger the next wave of defaults” in junk bonds, Deutsche Bank said. According to the bank, energy companies now account for about 15 per cent of outstanding issuance in the non-investment-grade high-yield – or “junk” – bond market.

Most likely this will trigger defaults throughout the high-yield bond market like the housing bust did, but on a smaller scale.

The current articles are saying that the collapse won’t come until prices fall to $60, but just a few months ago they said the collapse would happen at $70. So they really don’t know.

Most likely the timing of the collapse will come when creditors cut off the fracking companies and they run out of funny money, and not a moment before.

 At the moment, some U.S. producers are surviving because they managed to hedge the prices they get for their oil at about $90 a barrel, Fedun said. When those arrangements expire, life will become much more difficult, he said.

Without a bounce in oil prices, the fracking boom is in countdown mode right now, with several producers already poised to choke on junk bond debt service.

http://www.dailykos.com/story/2014/11/28/1348011/-U-S-Shale-industry-about-to-crash

Fracking Mess