US envoy pressured Halliburton to hire Kuwaiti fuel firm

By Sue Pleming, Reuters  |  November 11, 2004

WASHINGTON -- The US ambassador to Kuwait and other senior US officials put pressure on Halliburton to award a deal to a Kuwaiti company suspected of overcharging to bring fuel into Iraq, according to State Department documents released yesterday.

The documents, portions of which were released by Democratic Representative Henry Waxman of California, also said the State Department received information in the summer of 2003 that Halliburton officials demanded kickbacks and solicited bribes from Altanmia Commercial Marketing Company of Kuwait.

Altanmia is at the center of an investigation into whether Halliburton subsidiary Kellogg Brown and Root, or KBR, overcharged in 2003 for getting fuel into Iraq, which suffered a shortage of refined products despite having plenty of oil.

A draft Pentagon audit at the end of last year found evidence KBR might have overcharged by at least $61 million for bringing in fuel from Kuwait under its no-bid US Army Corps of Engineers contract.

According to the documents, on Dec. 2, 2003, Richard Jones, the US ambassador to Kuwait, sent an e-mail directing unidentified officials: ''Tell KBR to get off their butts and conclude deals with Kuwait NOW! Tell them we want a deal done with Altanmia within 24 hours and don't take any excuses."

The e-mail added, ''If Amb. Bremer hears that KBR is still dragging its feet, he will be livid," referring to the US civilian administrator of Iraq, Paul Bremer.

The State Department did not immediately respond to questions about the documents, and the department's Inspector General's office declined to comment on them.

Halliburton has been a lightning rod of criticism by Democrats, who say the company is the US military's biggest contractor in Iraq because of its ties to Vice President Dick Cheney, who ran the Texas-based company from 1995 to 2000.

Last month, just days before the US presidential election, the Army Corps of Engineers' top contracting official, Bunny Greenhouse, said deals given to Halliburton were the worst case of contracting abuse she had ever seen. Greenhouse is set to be interviewed by the FBI about her allegations.

Waxman said more than 400 State Department documents provided to the House Committee on Government Reform, of which he is the ranking minority member, undermined claims Halliburton contracts were ''awarded without political interference."

The California Democrat, one of the most vocal critics of Halliburton, asked Republican Representative Tom Davis of Virginia, chairman of the committee, for hearings into KBR's oil deals in Iraq.