LIEBERMAN CALLS FOR HEARINGS TO EXAMINE IRAQI CONTRACTS
HALLIBURTON DEAL MORE EXTENSIVE THAN FIRST DISCLOSED
OTHER CONTRACTS MAY COST TAXPAYERS EXTRA

May 16, 2003

WASHINGTON - Calling for transparency in multi-million dollar government contracts, Governmental Affairs Committee Ranking Member Joe Lieberman, D-Conn., Friday strongly urged that congressional hearings be held to examine in detail the no-bid contract awarded to a Halliburton Corporation subsidiary to extinguish Iraqi oil well fires.

In a letter dated May 16, 2003, to Committee Chairman Susan Collins, R-Me., Lieberman asked that the hearings also include a closer look at Iraqi reconstruction contracts that were awarded through a closed or limited bidding process.

“Only through complete disclosure, can we ensure that the American people will have confidence in how their government chose to award these contracts,” Lieberman wrote in the letter.

In March, the Army Corps of Engineers announced a no-bid contract had been awarded to the Halliburton subsidiary Kellogg, Brown & Root to extinguish oil well fires and repair the nation’s petroleum infrastructure. Last week, the Corps released information indicating the contract was far more extensive than it had originally disclosed.

Lieberman has twice written to the U.S. Agency for International Development for details on the agency’s use of a closed bidding process for awarding reconstruction contracts. The agency’s inspector general later found that one of the contracts was awarded to a company without a security clearance, despite the fact that the agency required them in the initial bidding process.

“While I agree that the urgent and pressing needs in Iraq demand swift attention, I nevertheless believe that the administration should be forthright and open with the American people about the details of all the rebuilding contracts in Iraq,” Lieberman said.

Lieberman and Collins are original co-sponsors of legislation that would require the administration to publicly disclose details of any Iraqi reconstruction contracts. The legislation has been referred to the Governmental Affairs Committee.

Following is a copy of Lieberman’s letter:

May 16, 2003

The Honorable Susan M. Collins
The United States Senate
Washington, D.C. 20510

Dear Senator Collins:

As you know, Senator Frank Lautenberg has recently asked the Governmental Affairs Committee to hold hearings to investigate the Iraqi reconstruction contract awarded to Kellogg, Brown & Root (KBR), a subsidiary of the Halliburton Corporation. I agree with Senator Lautenberg’s desire for transparency and disclosure on this important issue, and I strongly urge you to conduct hearings at the earliest possible date on all of the Iraqi reconstruction contracts that were awarded through a closed or limited bidding process.

In March, the Army Corps of Engineers announced that it had awarded a no-bid contract to KBR. At the time, the Corps said the contract was to extinguish oil well fires in Iraq and repair the country’s “petroleum infrastructure.” However, last week we learned that this contract went far beyond what was initially disclosed. In a letter to Rep. Henry Waxman, the Corps acknowledged for the first time that the contract with KBR would also allow the company to operate Iraqi oil fields and even distribute Iraqi oil.

I have been concerned for some time about the manner in which the Bush Administration has awarded a number of contracts related to the rebuilding efforts in postwar Iraq, including the contract awarded to KBR. While I agree that the urgent and pressing needs in Iraq demand swift attention, I nevertheless believe that the administration should be forthright and open with the American people about the details of all of the rebuilding contracts in Iraq. I have written to the U.S. Agency for International Development on two occasions seeking details on why the Agency chose to use a closed bidding process for awarding contracts, and how this closed process operated. I have also joined you in becoming an original cosponsor of legislation (S.876) to require the administration to publicly disclose the details of any Iraqi reconstruction contracts that are awarded without an open and competitive bidding process. But as we saw last week with the disclosure of new details regarding the KBR contract, more steps need to be taken soon to ensure that all details regarding this and other contracts are made public.

That is why I am strongly urging you to call hearings on all post war Iraq contracts awarded by the Bush Administration through a closed or limited bidding process. It is only appropriate that we provide the American people with the details of these contracts and how they were awarded. Only through complete disclosure, can we ensure that the American people will have confidence in how their government chose to award these contracts.

Thank you for your consideration of this request. I look forward to continuing to work with you on this important issue.