Halliburton Cash Registers Ring in Iraq

Saturday, 03 May 2003 03:48 by: Anonymous
By Lisa Myers and the NBC News Investigative Team

Saturday 3 May 2003

Subsidiary s contracts reach all aspects of reconstruction

WASHINGTON, May 2 Halliburton Energy Services, the giant government contractor formerly headed by Vice President Dick Cheney, is overseeing no-bid Army projects worth nearly a half-billion dollars that involve almost every aspect of U.S. operations in Iraq, NBC News has learned. The projects extend well beyond a previously reported Pentagon contract the company won to put out oil-well fires in Iraq two months ago.

When Army troops churned through the sand toward Baghdad last month, Halliburton was not far behind. An examination of documents by NBC News investigative team revealed that the Army had already paid or planned to pay $425 million to a Halliburton subsidiary called Kellogg Brown & Root Engineering & Construction for work involving Operation Iraqi Freedom.

Among the projects awarded to KBR without competitive bids were $36 million to help build and operate Camp Arifjan, the sprawling U.S. military base in Kuwait; $28 million to build and maintain camps housing prisoners of war; and $62 million to feed and house troops providing humanitarian aid.

KBR locked in the deal in 2001, when it outbid two rivals for a massive contract to handle worldwide logistics for the Army. The contract awarded KBR exclusive, no-bid rights to Pentagon construction and maintenance projects around the globe for 10 years.

Since then, KBR has undertaken 35 projects in Iraq and Afghanistan including some that preceded combat in Iraq with a total value of $518 million, none of which were open to competitive bidding, NBC s analysis showed.


Both Halliburton and Cheney s office strenuously denied that the vice president had anything to do with the 2001 contract, and NBC News found no evidence that he played a role in its awarding.

The Vice President is not involved in awarding any contract on behalf of the Department of Defense or any other agency of the federal government and has had no conversations regarding the contracts in question with either Defense Department personnel or representatives of Halliburton, Cheney s office said in a statement Friday evening.

Halliburton officials declined to be interviewed. The company said that it had a proven track record with the military and that it was an insult to suggest that Cheney, who severed his financial ties to the company when he became vice president, influenced the contract in any way.


Halliburton said taxpayers were getting their money s worth because KBR had incentives to hold down costs. But critics said the no-bid contract essentially allowed KBR to bill the government at will without any oversight.

It would be like hiring a plumber and saying I m going to pay you for whatever you do whatever you buy and how long it takes you, said Peter Singer, a fellow at the Brookings Institution who specializes in military dealings with the private sector.

The Army defended the contract, saying it would take too long to open every job to competitive bids during a time of war. It told NBC News that it needed a dependable company on call 24 hours a day to clean troops clothes, serve them meals, build them housing and provide other services like operating their gyms.

They re sort of like the Hotel 6, said Don Trautner, manager of the Army s Logistics Civilian Augmentation Program. They leave the light burning on for the Army worldwide.

But Charles Lewis, executive director of the Center for Public Integrity, a nonprofit government watchdog based in Washington, said the arrangement highlighted the concentration of influence in a small number of well-connected companies:

We really have a very, very elite exclusive little band of brothers getting fat contracts, and Halliburton is one of those companies.

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Last modified on Monday, 21 April 2008 13:38