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by Susie Dow
Sunday, May. 11, 2003 at 3:05 PM
If you have been confused by the constant flow of news stories on the Halliburton contracts for post-war Iraq, you have good reason to be.
Halliburton is a large company with numerous divisions and subsidiaries divided primarily in to two core groups:
KBR (Kellogg, Brown & Root) Engineering and Construction
On December 14, 2001, the Army Material Command awarded Halliburton KBR Government Operations an Indefinite Delivery/Indefinite Quantity 10 year contract known as the Logistics Civil Augmentation Program III (LOGCAPIII)
From the Halliburton press release: [Halliburton KBR Government Operations] will provide for the construction of facilities and infrastructure of base camps including billeting, mess hall, food preparation, potable water, sanitation, showers, laundry, transportation, utilities, warehousing and other logistical support. Also included is support of the Reception, Staging, Onward Movement, Integration (RSOI) process of U.S. Forces as they enter or depart their theater of operation by sea, air or rail.
In November 2002, under LOGCAPIII, the Department of Defense requested KBR develop a contingency plan "for assessing and extinguishing oil well fires in Iraq and evaluating and repairing, as directed by the US government, the country's petroleum infrastructure."
On March 8, 2003, KBR was awarded a cost plus 7% contract thru the Army Core of Engineers to implement the contingency plan KBR had developed for the DoD. This contract was valued at a cap of $7 billion dollars. However, the awarding of the contract was not announced until 5 days after the invasion had begun, on March 24.
KBR has subcontracted the firefighting portion of the work to Houston-based companies Boots & Coots International Well Control, Inc. and Wild Well Control, Inc as well as services from International Response Corporation (IRC) "to assist with the assessment and cleanup of oil spills." IRC is the international service affiliate of National Response Corporation (NRC).
The implementation contract is executed thru task orders. As the work is required, a task order is issued. To date approximately $74.3 million to $89.5 million dollars in task orders related to Iraq's petroleum infrastructure have been issued. The LATimes reports in a May 9 article an additional task order is pending. (there are references to 2 sets of figures for the actual cost: a) $50.3 + $24 million b) $69.5 + $20 million. Both figures are provided as we do not know which is the most accurate.)
In addition to the LOGCAPIII and the implementation contracts, on April 10, the New York Times reported KBR was awarded a $30 million dollar contract thru the Defense Threat Reduction Agency to dismantle and neutralize any chemical or nuclear weapons found in the region.
Under the terms of the 10 year LOGCAPIII contract, Halliburton KBR Government Operations also provides direct support to the military in the region. As a result of this Indefinite Delivery/Indefinite Quantity contract, approximately $90 million dollars has been spent. It is estimated this portion of Halliburton's work in Iraq will reach $200 million when completed.
Until August of 2000, Vice President Dick Cheney was employed by Halliburton. Having also served as Halliburton's chief executive officer, he continues to receive an annual pension from the company. Senators are questioning the propriety of the contracts.
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