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Halliburton Makes a Killing on Iraq War

recent report is that the firefighting of oil well fires contract has gone to Haliburton- Kellog (yep, kellogs cereal corporation) -- no other bids were considered... Halliburton is also one of five large US corporations invited to bid
for contracts in what may turn out to be the biggest reconstruction project
since the Second World War. The others are the Bechtel Group, Fluor
Corp, Parsons Corp, and the Louis Berger Group.
Halliburton Makes a Killing on Iraq War

Cheney's Former Company Profits from Supporting Troops

Special Series
By Pratap Chatterjee
Special to CorpWatch
March 20, 2003


As the first bombs rain down on Baghdad, CorpWatch has learned that thousands of employees of Halliburton, Vice President Dick Cheney's former
company, are working alongside US troops in Kuwait and
Turkey under a package deal worth close to a billion dollars.
According to US Army sources, they are building tent cities and providing logistical support for the war in Iraq in addition to other hot spots in the "war on terrorism."

While recent news coverage has speculated on the post-war reconstruction
gravy train that corporations like Halliburton stand to gain from, this
latest information indicates that Halliburton is already profiting from
war time contracts worth hundreds of millions of dollars.

Cheney served as chief executive of Halliburton until he stepped down
to become George W. Bush's running mate in the 2000 presidential race.
Today he still draws compensation of up to a million dollars a
year from the company, although his spokesperson denies that the White House
helped the company win the contract.

In December 2001, Kellogg, Brown and Root, a subsidiary of Halliburton,
secured a 10-year deal known as the Logistics Civil Augmentation
Program (LOGCAP), from the Pentagon. The contract is a "cost-plus-award-fee,
indefinite-delivery/indefinite-quantity service" which basically means
that the federal government has an open-ended mandate and budget to send
Brown and Root anywhere in the world to run military operations for a profit.

Linda Theis, a public affairs officer for the U.S. Army Field Support
Command in Rock Island Arsenal, Illinois, confirmed for Corpwatch that
Brown and Root is also supporting operations in Afghanistan,
Djibouti, Georgia, Jordan and Uzbekistan.

"Specific locations along with military units, number of personnel
assigned, and dates of duration are considered classified," she
said. "The overall anticipated cost of task orders awarded since contract
award in December 2001 is approximately $830 million."

Kuwait The current contract in Kuwait began in September 2002
when Joyce Taylor of the U.S. Army Materiel Command's Program Management
Office, arrived to supervise approximately 1,800 Brown and Root employees
to set up tent cities that would provide accommodation for tens of thousands
of soldiers and officials.

Army officials working with Brown and Root says the collaboration is helping cut costs by hiring local labor at a fraction of regular Army salaries.
"We can quickly purchase building materials and hire third-country
nationals to perform the work. This means a small number of combat-service-support soldiers are needed to support this logistic aspect of
building up an area," says Lt. Col. Rod Cutright, the senior LOGCAP planner
for all of Southwest Asia.

During the past few weeks, these Brown and Root employees have helped
transform Kuwait into an armed camp, to support some 80,000 foreign
troops, roughly the equivalent of 10% of Kuwait's native born

Most of these troops are now living in the tent cities in the rugged
desert north of Kuwait City, poised to invade Iraq. Some of the encampments
are named after the states associated with the attacks of Sept. 11, 2001 --
Camp New York, Camp Virginia and Camp Pennsylvania.

The headquarters for this effort is Camp Arifjan, where civilian and
military employees have built a gravel terrace with plastic picnic
tables and chairs, surrounded by a gymnasium in a tent, a PX
and newly arrived fast food outlets such as Burger King, Subway and
Baskin-Robbins, set up in trailers or shipping containers. Basketball hoops and
volleyball nets are set up outside the mess hall.

Turkey North of Iraq approximately 1,500 civilians are working for Brown and Root and the United States military near the city of Adana, about an hour's
drive inland from the Mediterranean coast of central Turkey,
where they support approximately 1,400 US soldiers staffing Operation
Northern Watch's Air Force F-15 Strike Eagles and F-16 Fighting Falcons
monitoring the no-fly zone above the 36th parallel in Iraq.

The jet pilots are catered and housed at the Incirlik military base seven
miles outside the city by a company named Vinnell,Brown and Root (VBR), a
joint venture between Brown and Root and Vinnell corporation of
Fairfax, Virginia, under a contract that was signed on October
1, 1988, which also includes two more minor military sites in Turkey:
Ankara and Izmir.

The joint venture's latest contract, which started July 1, 1999 and
will expire in September 2003, was initially valued at $118
million. US Army officials confirm that Brown and Root has been awarded
new and additional contracts in Turkey in the last year to support the
"war on terrorism" although they refused to give any details.

"We provide support services for the United States Air
Force in areas of civil engineering, motor vehicles transportation, in
the services arena here - that includes food service operations, lodging,
and maintenance of a golf course. We also do US customs inspection,"
explained VBR site manager Alex Daniels, who has worked at Incirlik for almost 15 years.

Cheap labor is also the primary reason for outsourcing services, says
Major Toni Kemper, head of public affairs at the base. "The
reason that the military goes to contracting is largely because it's
more cost effective in certain areas. I mean there was a lot of studies years
ago as to what services can be provided via contractor versus
military personnel. Because when we go contract, we don't have to pay health care and all the another things for the employees, that's up to the employer."

Soon after the contract was signed Incirlik provided a major staging
post for thousands of sorties flown against Iraq and occupied Kuwait during
the Gulf war in January 1991 dropping over 3,000 tons of bombs on military
and civilian targets.

Central Asian Contracts: Still ongoing is the first LOGCAP contract in the "war
on terrorism" which began in June 2002, when Brown and Root was awarded a
$22 million deal to run support services at Camp Stronghold Freedom,
located at the Khanabad air base in central Uzbekistan. Khanabade is one of the
main US bases in the Afghanistan war that houses some 1,000 US soldiers
from the Green Berets and the 10th Mountain Division.

In November 2002 Brown and Root began a one-year contract, estimated at
$42.5 million, to cover services for troops at bases in both Bagram and
Khandahar. Brown and Root employees were first set to work running
laundry services, showers, mess halls and installing heaters
in soldiers' tents.

Future Contracts in Iraq:
Halliburton is also one of five large US corporations invited to bid
for contracts in what may turn out to be the biggest reconstruction project
since the Second World War. The others are the Bechtel Group, Fluor
Corp, Parsons Corp, and the Louis Berger Group.

The Iraq reconstruction plan will require contractors to fulfill
various tasks, including reopening at least half of the "economically important
roads and bridges" -- about 1,500 miles of roadway within 18 months,
according to the Wall Street Journal.

The contractors will also be asked to repair 15% of high-voltage
electricity grid, renovate several thousand schools and deliver
550 emergency generators within two months. The contract is estimated to be
worth up to $900 million for the preliminary work alone.

The Pentagon has also awarded a contract to Brown and Root to control
oil fires if Saddam Hussein sets the well heads ablaze.
Iraq has oil reserves second only to those of Saudi Arabia. This makes Brown
and Root a leading candidate to win the role of top contractor in any
petroleum field rehabilitation effort in Iraq that industry analysts
say could be as much as $1.5 billion in contracts to jump start Iraq's
petroleum sector following a war.

Wartime Profiteering:
Meanwhile Dick Cheney's 2001 financial disclosure statement, states
that the Halliburton is paying him a "deferred compensation" of
up to $1million a year following his resignation as chief executive in
2000. At the time Cheney opted not to receive his severance package in a
lump sum, but instead to have it paid to him over five years, possibly for
tax reasons.

The company would not say how much the payments are. The obligatory
disclosure statement filled by all top government officials says only
that they are in the range of $100,000 and $1million. Nor is it clear how
they are calculated.

Critics say that the apparent conflict of interest is deplorable. "The
Bush-Cheney team have turned the United States into a family business,"
says Harvey Wasserman, author of The Last Energy War (Seven
Stories Press, 2000).
"That's why we haven't seen Cheney - he's cutting deals with his old
buddies who gave him a multimillion-dollar golden handshake.
Have they no grace, no shame, no common sense? Why don't they just have Enron
run America? Or have Zapata Petroleum (George W. Bush's failed
oil-exploration venture) build a pipeline across Afghanistan?"

Army officials disagree. Major Bill Bigelow, public relations officer
for the US Army in Western Europe, says: "If you're going to ask a specific
question - like, do you think it's right that contractors profit in
wartime - I would think that they might be better [asked] at a higher
level, to people who set the policy. We don't set the policy,
we work within the framework that's been established."

"Those questions have been asked forever, because they go back to World
War Two when Chrysler and Ford and Chevy stopped making cars and started
making guns and tanks. Obviously it's a question that's been around for quite
some time. But it's true that nowadays there are very few defense
contractors, but go back sixty years to the World War Two era
almost everybody was manufacturing something that either directly or
indirectly had something to do with defense," he added.

Sasha Lilley and Aaron Glantz helped conduct
interviews for this article.

Pratap Chatterjee is an investigative journalist based
in Berkeley, California. He traveled to Afghanistan and Uzbekistan
in January 2002 and to Incirlik, Turkey, in January 2003 to research this

homepage: homepage: http://www.corpwatch.org/issues/PID.jsp?articleid=6008

Blood on their Hands Walking tour... 01.Apr.2003 14:52


The kind of stuff that's in this article will be the same sort of stuff that will be talked about during the Blood on their Hands Walking Tour. You should go. Check out the feature on the front page of indymedia. Be there or be... square.