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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: Srexley who wrote (507922)	12/11/2003 7:18:56 PM
From: jackhach	Read Replies (2) \| Respond to of 769668

NO CAMERAS ALLOWED at news conference! Halliburton gouging on fuel: Pentagon Oil services firm once run by Cheney overcharged for fuel it brought into Kuwait: military sources. December 11, 2003: 5:26 PM EST WASHINGTON (Reuters) - A Pentagon audit of Halliburton, the oil services company once run by Vice President Dick Cheney, has found it overcharged for fuel it brought into Iraq from Kuwait, military sources said Thursday. The sources told Reuters that Kellogg Brown and Root, a Halliburton unit which got a no-bid U.S. government contract to rebuild Iraq's oil industry, had been notified by the Pentagon's Defense Contract Audit Agency. So far the company has clocked up $2 billion in business from the March contract. Halliburton spokeswoman Wendy Hall said the company had not overcharged and that the company was confident its responses would satisfy the agency. "KBR is confident its processes will continue to stand against the rigorous audits conducted by the Defense Contract Audit Agency," Hall said. She added in an e-mail response, "It would not be appropriate to discuss the specifics of the questions until our conversations with DCAA are complete." One military source said KBR was seeking "voluntary refunds" from the Kuwait National Petroleum Co. over the import of fuel into Iraq. The company has been bringing fuel into Iraq either from Turkey or via Kuwait and has justified its pricing because of the high cost of security and a shortage of trucks which had driven up prices. KBR won a no-bid contract last March to help restore Iraq's oil industry. So far, it has been allocated more than $2 billion in business. It also has another contract to provide logistical support to U.S. troops there, from delivering mail to building barracks. Democratic lawmakers had raised questions over KBR's prices for fuel being trucked from Kuwait into Iraq, an oil-rich country that is suffering a fuel shortage until its oil refineries are working at full capacity. Of the $2 billion allocated to KBR so far, about $1.2 billion has gone into paying for oil supplies for the Iraqi people. Of that amount, $90 million has been paid out of seized Iraqi assets and $825 million has come from the Development Fund for Iraq, which was established by the United Nations. An Army Corps of Engineers spokesman said funds to pay for fuel had intentionally come from Iraqi coffers rather than paid for by appropriated funds from Congress, where criticism has been strongest over Halliburton's work in Iraq. Several government agencies are closely monitoring Halliburton's performance in Iraq and the General Accounting Office, an investigative arm of Congress, is set to release a report next month on U.S. government contracts in Iraq. Earlier, the U.S. military said it was trimming funds allocated to KBR for its work in Iraq but said this was not linked to price gouging claims. U.S. Army Corps of Engineers spokesman Bob Faletti said about $1 million would be cut from one of seven work orders given to KBR. "This is not in response to criticism. It is just being fiscally responsible," said Faletti of the small reduction. Halliburton (HAL: Research, Estimates) stock fell about 1.2 percent in an otherwise up market Thursday. Copyright 2003 Reuters