Halliburton snared by Iraq claims

OIL services company Halliburton has been caught in a profiteering row, amid claims that it is charging nearly three times the market rate for petrol imported into Iraq.

The company, once headed by US Vice President Dick Cheney, has a contract with the US Army Corps of Engineers to rebuild Iraq's oil sector and to import fuel until its oilfields are able to provide supplies.

Democrats say the US government is paying Halliburton $2.65 a gallon for the fuel, but that Iraqi company SOMO imports it for just 97 cents.

'Experts we consulted stated that the total price for buying and transporting gasoline into Iraq should be less than $1 per gallon.'

They acknowledged that the pricing may be the work of Kuwaitis with Halliburton a victim. 'We know that someone is getting rich importing gasoline into Iraq,' the duo added. 'What we don't know is who is making the money, Halliburton or the Kuwaitis?'

Washington is making a huge loss on the deal as it subsidises petrol sold in Iraq, charging the public a maximum of 15 cents a gallon.

Halliburton, through its subsidiary Kellogg Brown & Root, has imported more than 60m gallons of petrol from Kuwait. It imports petrol from Turkey at a far lower price.

The company would not comment on the accusations. It is no stranger to controversy over its Iraq deals. Earlier this month it denied that it was overcharging on fuel, saying it was supplying at cost with a 2% fee.

Waxman has been a major critic of the way contracts have been handed out for the reconstruction of Iraq, claiming that associates of Cheney and President Bush have been major beneficiaries. He wrote earlier this month to the White House Office with a complaint that Halliburton was charging too much. At the time he said the average price was $1.59 a gallon.

It was also revealed yesterday that Halliburton will retain its contract in Iraq for longer than expected.

The contract, worth $1.59bn (£934m) so far, will be extended until December or January, the Bush administration said, blaming sabotage of oil facilities for delays.

Halliburton's contract will be split - with a maximum cost of $800m for work on the northern oil fields and up to $1.2bn to restore the southern fields.

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