Lawmaker Says Halliburton's Role Expanded in Iraq
WASHINGTON (Reuters) - Halliburton (NYSE:HAL - news), the oil giant once run by Vice President Dick Cheney (news - web sites), appears to have been given a bigger role in rebuilding Iraq (news - web sites)'s oil industry, according to letters between the U.S. military and Congress.
In a letter sent on Tuesday to the U.S. Army Corps of Engineers, California Rep. Henry Waxman, a Democrat, raised questions about the contract awarded without competition to a Halliburton subsidiary, Kellogg Brown and Root.
Waxman said originally the contract had been described as one to extinguish oil well fires and do related repairs, but Halliburton now appeared to have a more lucrative and direct role in rebuilding Iraq's oil industry.
"It now appears however, that the contract with Halliburton -- a company with close ties to the Administration -- can now include 'operation' of Iraqi oil fields and 'distribution' of Iraqi oil," wrote Waxman to Lt. Gen. Robert Flowers of the U.S. Army Corps of Engineers.
Waxman was replying to a letter from Flowers sent last week which said the scope of work included extinguishing oil well fires and cleaning up related damage as well as the "operation of facilities and distribution of products."
The letter from Flowers did not indicate what was meant by the operation of facilities or the distribution of products but the White House has always said that Iraq's oil industry belongs to its people. Flowers' office was not immediately available for comment.
Asked on Wednesday about the issue, White House spokesman Ari Fleischer (news - web sites) said: "It's not a White House issue ... the White House does not get involved in who gets contracts."
The total amount of the Halliburton contract is not known but last month army officials said it would be far less than the "worst-case scenario" ceiling of $7 billion.
When the contract was first awarded to Halliburton, some Democrats raised questions over whether the company's close ties to the administration had helped it secure the work, a suggestion the White House strongly rejects.
Cheney was formerly chief executive for five years of Houston-based Halliburton, the world's second-largest oilfield service company.
Company officials in Houston were not immediately available to comment on the Iraqi contract.