Only weeks before Halliburton made headlines by announcing it was pulling out of Iran—a nation George W. Bush has labeled part of the “axis of evil”—the Texas-based oil services firm quietly signed a major new business deal to help develop Tehran’s natural gas fields.
Halliburton’s new Iran contract, moreover, appears to suggest a far closer connection with the country’s hard-line government than the firm has ever acknowledged.
The deal, diplomatic sources tell NEWSWEEK, was signed with an Iranian oil company whose principals include Sirus Naseri, Tehran’s chief international negotiator on matters relating to the country’s hotly-disputed nuclear enrichment program—a project the Bush administration has charged is intended to develop nuclear weapons.
There are few matters more sensitive for Halliburton than its dealings with Iran. The company, formerly headed by Vice President Dick Cheney, last year disclosed that it had received a subpoena from a federal grand jury in Texas in connection with a Justice Department investigation into allegations that the firm violated U.S. sanctions law prohibiting American companies from directly doing business in Iran. (U.S. firms are barred from doing direct business in Iran, but under a confusing quilt of federal regulations, their foreign subsidiaries may do so as long as they operate “independently” from U.S. management.)
Documents disclosed by the company indicate that the Justice Department probe into Halliburton’s Iran dealings, like a separate Justice investigation into alleged foreign bribes paid by a Halliburton-connected consortium to officials in Nigeria, cover the period that Cheney was Halliburton CEO.
There have been no allegations that Cheney was directly involved in any of the conduct that is under scrutiny by Justice, although as Halliburton CEO, Cheney repeatedly and forcefully criticized the U.S. sanctions laws restricting business in Iran, arguing that they caused U.S. firms like Halliburton to lose business to international competitors. (As it has in the past, Cheney’s office today declined to say whether the vice president has been questioned by investigators on either the Iran or Nigerian matters.)
Halliburton’s new deal, in which it will participate in a $308 million project to develop Iran’s huge South Pars natural gas fields, was not at first publicly announced by the company. But after the South Pars project, and its role, was reported in the Iranian press in mid-Janury, Halliburton publicly confirmed that its Dubai-based subsidiary, Halliburton Products & Services Limited, had been awarded a subcontract on the project that, a Halliburton official told NEWSWEEK today, will net the parent firm between $30 million and $35 million over the next several years.
The new Halliburton project, congressional investigators say, raises substantial questions about the Jan. 28, 2005 public announcement by Halliburton CEO (and Cheney successor) David Lesar that the firm plans to cease doing business in Iran. Lesar made no reference to the South Pars project in his conference call with investment analysts that day, when he blamed “the political nature of the attacks on Halliburton” for the media attention given the company’s Iranian business.
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