Halliburton Unit Gets Over $800 Million
Fri June 20, 2003 04:23 PM ET
By Sue Pleming
WASHINGTON (Reuters) - A unit of Halliburton Co., the Texas oil giant once led by Vice President Dick Cheney, has received more than $800 million in work orders in Iraq so far, according to military figures obtained Friday.
The bulk of the orders are under a military contract awarded in December 2001 to Halliburton subsidiary Kellogg Brown & Root that a Democratic lawmaker labeled "obscure and lucrative."
That 2001 contract, called the Logistics Civil Augmentation Program does not have a ceiling. By the end of May, task orders for Iraq accounted for $596.8 million of the $708 million earmarked under that deal.
Under that contract, the Halliburton subsidiary has provided housing, recreation, laundry, power and sanitation for troops in Iraq, said Dan Carlson, a spokesman for U.S. Army Field Support Command in Rock Island, Illinois.
Kellogg Brown & Root has a separate contract with the U.S. Army Corps of Engineers to repair and operate Iraq's oil wells. That contract was awarded in March in a no-competition bidding process.
By June 13, $213 million had been budgeted under this contract to Kellogg. The contract has a ceiling of $7 billion, but this limit was formulated with the worst-case scenario in mind. The U.S. Army Corps of Engineers was expected soon to open up this contract to competitive bids.
Several Democratic lawmakers have complained loudly about the amount of work given to Halliburton, suggesting the company's close links to the White House brought business to the firm, a view the White House strongly rejects.
Army Lt. Gene Pawlick, a spokesman for the U.S. Army Corps of Engineers in Washington, said a new tender inviting competitive bids to replace Kellogg's contract in Iraq was likely to be announced very shortly, possibly early next week. Kellogg can also bid for the new contract.
So far, under the contract, Kellogg has repaired oil facilities, provided training, damage assessment, construction of base camps for workers and distribution of liquid propane to Iraqis, said Pawlick.