Halliburton subsidiary Kellogg Brown and Root has now clocked up $2.26 billion under its March no-bid contract with the US Army Corps of Engineers to rebuild Iraq's oil sector.

Army Corps of Engineers spokesman Bob Faletti said on Monday a new task order was made for KBR last week worth up to $222 million for the "restoration of essential infrastructure."
 
Faletti said this work order would be paid for by money from the Development Fund for Iraq and not from $18.6 billion in new funds to rebuild Iraq appropriated by Congress.

He said Congress had specified new funding for Iraq should not be used for contracts that were not competitively bid, such as the deal with KBR.

"To make sure that we avoided any perception of wrongdoing, we are not co-mingling appropriated and non-appropriated funds (from Congress)," said Faletti.

Most of the funds paid to KBR to bring in fuel to Iraq, which despite being oil rich is suffering a shortage, have come from the Development Fund, which includes oil revenues from Iraq.

Overbilling charges 

Halliburton is in the process of answering questions raised by the Defense Contract Audit Agency over its work in Iraq after a draft audit found a Kuwaiti subcontractor may have overcharged it as much as $61 million for fuel.
 
Halliburton on Monday once again rejected charges of overbilling and said it welcomed any reviews and audits of its dangerous work in Iraq.

Halliburton is in the process of answering questions raised by the Defense Contract Audit Agency over its work in Iraq after a draft audit found a Kuwaiti subcontractor may have overcharged it as much as $61 million for fuel.

Asked to provide details on the cost of getting fuel into Iraq from Kuwait, Halliburton spokeswoman Wendy Hall said the average cost was $2.64 a gallon and that for every gallon delivered the company made only a few cents.
 
"Not many people want to drive eight days, round trip in a war zone, with a truck full of flammable materials. The subcontractor has had three drivers killed and 10 injured while
performing this mission and 60 vehicles damaged or destroyed," she said.

She said the Army Corps of Engineers had told KBR to find a company that met stringent requirements to deliver fuel into Iraq. KBR sought and received bids from four suppliers and only one subcontractor had met the Corps' specifications.

Hall said KBR had been negotiating pricing for fuel with the Kuwaiti sub-contractor but did not provide details.

KBR's no-bid deal is set to be replaced with two competitively-bid contracts to rebuild Iraq's shattered oil infrastructure. Those new contracts, worth up to $2 billion, are set to be awarded between now and mid-January.