Gazprom and its sponsorship of football. From sex without a condom to major strategic threat

During a UEFA Champions League match in 2013, Greenpeace activists unfurled a large banner from a stadium roof to reveal to the statement ‘Don’t Foul the Arctic’. This was in response to Russian oil and gas corporation Gazprom engaging in high risk oil exploration in one of the world’s most fragile ecosystems.

The match, at FC Basel’s St. Jakob Park Stadium in Switzerland, involved FC Schalke 04 of Germany’s Bundesliga – a club whose shirts have been sponsored since 2007 by Gazprom. When the initial deal was signed, German football magazine 11Freunde likened it to the club having sex without a condom.

When the Basel game took place, the Champions League itself was also being sponsored by Gazprom, a deal first signed in 2012. Indeed, the latest iteration of the Russian state-owned oil and gas corporation’s deal will see its relationship with UEFA running to the end of 2021’s football season.

For some, the choice of Schalke and the Champions League sponsorships by the Saint Petersburg-based organisation has always been puzzling. After all, unlike other football sponsors Gazprom doesn’t directly sell anything in consumer markets. Rather, it sells gas to governments.

But this provides clues as to why a club based in Gelsenkirchen, part of Germany’s Ruhrgebiet (the country’s traditional industrial heartland), has been of interest to Gazprom. The region is Germany’s football hotbed, home to some of the country’s most passionate fans, but also once a major source of the country’s coal.

At first glance, the Schalke sponsorship may therefore have seemed like an attempt to build profile and legitimacy in a market that was transitioning to a post-coal future. Some of the suspicion previously directed at Gazprom has thus been premised upon an assumption that the Russian giant was attempting to greenwash its reputation.

However, around the same time as the Schalke deal was first announced, Gazprom was involved in negotiations with the German government to begin construction of a Russia-Germany pipeline under the Baltic Sea (not uncoincidentally bypassing the likes of Poland and Ukraine). By 2010, this pipeline had been finished and Germany began buying vast quantities of gas from Russia.

Sponsorship of Schalke therefore appears to have been more about influencing decision makers in Berlin and establishing legitimacy in the eyes of German consumers than it was about covering for any of the corporation’s environmental misdemeanours.

The same is true of Gazprom’s UEFA sponsorship deal, as the Champions League is a both a pan-European and global phenomenon that generates visibility and confers legitimacy upon the corporation, important commodities in what can sometimes be highly sensitive global energy markets.

Indeed, as Schalke and Gazprom’s German pipeline became important in the North, so the Russian organisation looked South for partners to collaborate on the development of South Stream. This concluded with the Gazprom’s name appearing on the shirts of Red Star Belgrade, and stories circulating that an acquisition of the club by the gas behemoth was imminent.

Ultimately, the Serbian government at the time decided to focus upon becoming an EU member, the Russian economy dipped, and Gazprom’s quest for a southern outlet for its gas supplies was put on ice. Yet the playbook was established: football has always been a means through which Gazprom seeks to further its strategic interests.

Hence recent developments, which some may have interpreted as the mundane politicking of football bureaucracy, have been noteworthy. Russia has decided to give up its place on the FIFA Council and has put forward a candidate – Alexander Dyukov – to join UEFA’s Executive Committee.

Dyukov is an interesting character; current president of Gazprom, he was also previously the president of Russian football club FC Zenit Saint Petersburg (which is, unsurprisingly, owned by Gazprom). All of which poses an obvious question: why is Gazprom is on the move again in football?

Unlikely as it may seem, an answer can be found in Washington DC, specifically the presidency of Donald Trump. The former US administration repeatedly called out Germany for its growing energy dependence upon Russia, which made for increasingly fractious relations with Berlin.

Indeed, once Germany and Russia reached an agreement for the construction of a second Baltic Sea gas pipeline (Nord Stream 2), the US ramped-up its diplomatic pressure and imposed sanctions upon Gazprom. Such is Washington’s perception of the strategic threat posed by this development, that the new Biden administration is doubling-down in its application of these sanctions.

As the political temperature has risen, Gazprom’s Nord Stream 2 project has been overseen by Mattias Warnig, a former Stasi agent from East Germany. Wanig is a long-time friend of Vladimir Putin and has worked with a number of Russia’s biggest corporations. In a recent You Tube video posting by Alexei Navalny’s Anti-Corruption Foundation (the FBK), mention of Wanig is made in connection with allegations about corruption in the construction of Putin’s Black Sea mansion.

But otherwise, with neither Russia nor the US backing down, recent reports suggest that further sanctions-busting Nord Stream 2 construction has resumed. A Russian pipelaying vessel has been sighted in Danish waters, working on the project’s final stages before the pipeline makes land. Once on German soil, it seems like that the political rhetoric will increase.

Which will be prescient and timely, as Gazprom’s deal with UEFA is up for renewal this year. Also, it seems more than a coincidence that Schalke’s deal with the corporation is due for renewal next year. In the meantime, Germany’s Bundesliga season continues and the UEFA Champions League season is about to recommence.

Many football fans will already be familiar with Gazprom’s adverts that often bookend half-time television breaks. With this familiarity comes some acceptance and a degree of legitimacy. We won’t be seeing Joe Biden’s name appearing anytime soon on football stadium rotational signage, but then Gazprom has always played this football sponsorship game better than the US.

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This article belongs to the GeoSport platform, developed by IRIS and EM Lyon.