The tap was turned off for Halliburton on Wednesday after the US Army said it had decided to suspend the exclusive multi-billion dollar servicing contract awarded to the Texas oil services giant in Iraq.
Halliburton, US Vice President Dick Cheney's old employer, is the US military's biggest contractor in Iraq. It has been under increasing scrutiny by Congress and government auditors, and is under investigation by the Justice Department for tens of millions of dollars in possible overcharges for its work in Iraq.
US Army officials said the US$6.4 billion contract which gave a Halliburton subsidiary, Kellogg, Brown and Root, exclusive rights to provide food, shelter, laundry services and transport to US forces serving in Iraq would be subject to new bids later this year, and the work could be split between three companies. A fourth firm would be hired to monitor performance.
Officials said the Army was satisfied with KBR's performance. But spokeswoman Betsy Weiner added: "The Army frequently looks at the way it does business and tries to look at lessons learned and find a better way to do business. We believe that competition is perhaps a better way to do business."
Halliburton would be eligible to bid for the work.
News that it would no longer be guaranteed work in Iraq took an immediate toll on share prices, which fell in early morning trading on Wednesday.
But spokeswoman Melissa Norcross said in a statement: "It is neither unusual nor unexpected."
Halliburton began reaping the profits of the war in Iraq even before the 2003 invasion, with a separate US$7 billion contract to repair the country's oilfields under the Iraqi reconstruction program. The firm was later awarded the contract to provide logistical support to US troops.
In the last few years members of Congress have been dogged in uncovering instances of waste and mismanagement by Halliburton and KBR.
Last year auditors uncovered US$1.4 billion in questionable charges by Halliburton. Former employees accused the firm of double billing on meals, grossly inflating the prices of services and allowing soldiers at Rammadi to bathe in contaminated water.
Halliburton defends its work in Iraq.
"By all accounts, KBR's logistical achievements in support of the troops in Iraq, Kuwait and Afghanistan have been nothing short of amazing," a statement said.
US Army officials have also praised the company's record in Iraq, but the Pentagon evidently has decided that competitive contracts would result in better accountability and prices.
Representative Henry Waxman, the Democratic congressman who has been one of Halliburton's harshest critics, welcomed the move but added: "The administration should have changed course a lot earlier. Its reliance on abuse-prone monopoly contracts in Iraq has cost taxpayers dearly."
The end of Halliburton's dominance in Iraq arrives at a time when the US is phasing out its role in Iraqi reconstruction. The Washington Post reported on Wednesday that 90 percent of the US$18 billion allotted by Congress for rebuilding post-war Iraq has been spent or allocated.
The rest of the money must be allocated by the end of September.
FOX HUNT: To suppress dissent, Chinese living abroad that Xi Jinping sees as threats are told to either return to China or commit suicide, Christopher Wray said Chinese agents have been pursuing hundreds of Chinese nationals living in the US in an effort to force their return, as part of a global campaign against the country’s diaspora, known as Operation Fox Hunt, FBI Director Christopher Wray said on Tuesday. In a speech about the security threat posed by China, during which he said Beijing’s counterintelligence work was the “greatest long-term threat to our nation’s information and intellectual property, and to our economic vitality,” Wray gave the example of one Fox Hunt target who was given a choice of going back to China or killing themselves. Fox Hunt was launched
INTERNET CURBS: People are rushing to erase their digital footprints after police given powers over online activity, although it might take years for the full effect to be felt At midnight on Tuesday, the Great Firewall of China, the vast apparatus that limits the country’s Internet, appeared to descend on Hong Kong. Unveiling expanded police powers as part of contentious new national security legislation, the Hong Kong government enabled police to censor online speech, and force Internet service providers to hand over user information and shut down platforms. Many residents, already anxious since the legislation took effect last week, rushed to erase their digital footprint of any signs of dissent or support for the past year of protests. Hong Kong Legislator Charles Mok (莫乃光), a pro-democracy member of the Legislative
‘FIGHT FOR FREEDOM’: Hong Kongers will never bow to Beijing, the advocate said, while the US’ envoy to the territory called China’s new security law a ‘tragedy’ The world must stand in solidarity with Hong Kongers after Beijing imposed sweeping national security legislation on the semi-autonomous territory, advocate Joshua Wong (黃之鋒) said yesterday, vowing to continue campaigning for democracy. Wong, one of the territory’s most prominent young advocates and a figure loathed by Beijing, was speaking outside a court where he and fellow advocates are being prosecuted for involvement in last year’s pro-democracy protests. China last week enacted sweeping security legislation for the restless territory, banning acts of subversion, secession, terrorism and collusion with foreign forces. The legislation has sent a wave of fear through the territory, and criminalized dissenting
‘SUICIDE’: Media reports said Park Won-soon went missing on Thursday after a staff member filed a sexual harassment claim against him this week Seoul mayor Park Won-soon, viewed as a potential candidate for the 2022 presidential election, was found dead of an apparent suicide hours after he was reported missing, police said, adding that he was the subject of an undisclosed investigation. In a note he is thought to have left behind on his desk, Park offered his apologies. “I thank everyone who was with me in my life. I apologize to my family for only making them suffer from pain,” according to the note that was released by his office yesterday. Park, in his letter, asked to be cremated and have his remains spread