A Pentagon audit of Halliburton, the oil services firm once run by Vice President Dick Cheney, has found the company may have overbilled the US government by more than $120 million on Iraq contracts.
US defence officials said yesterday that Halliburton's Kellogg Brown and Root (KBR) unit, which has denied wrongdoing, may have been overcharged by a Kuwaiti sub-contractor by $61 million for fuel brought into Iraq from Kuwait under a deal signed in March with the US Army Corps of Engineers to rebuild Iraq's oil industry.
That no-competition deal, which has clocked up about $2 billion in business so far, is set to be replaced by two new, competitively bid contracts to rebuild Iraq's oil sector.
After several delays, a decision on those $2 billion contracts is expected by mid-January and military sources said the audit would likely be considered when Halliburton's proposal was reviewed for the follow-on deals.
Under another KBR 10-year contract to provide logistical support for troops, the auditors found what they deemed a $67 million overcharge for dining facilities throughout the region. The overcharge was denied before taxpayers were billed.
Halliburton said it was supplying documentation requested by the auditors. "KBR has acted in full accordance with its fiduciary and contractual responsibilities under the contract," said a Halliburton spokeswoman.