Kuwait's oil minister has referred a Kuwait Petroleum Corp (KPC) contract to supply the US army with crude and gas products to the public prosecutor on Sunday to investigate any wrongdoing, the state news agency KUNA said.

"The deal between Petroleum Corporation and a contractor to supply the US army was referred to the public prosecutor to investigate... and provide the judiciary, which is known for its objectivity, a chance to have a final say on whether there was any abuse of power or of public funds," KUNA quoted Energy Minister Shaikh Ahmad al-Fahd al-Sabah as saying.

"By handing this matter to the judiciary, we show that we are not working in the dark but within the legal framework at our corporation and that we have the courage to take necessary measures if there was any mistake, for nobody is above the law."

Shaikh Ahmad did not specify the contract in question.

Overcharging evidence

A US draft audit in December found evidence that a subsidiary of the US firm Halliburton may have overcharged by $61 million for bringing fuel into Iraq via Kuwaiti subcontractor Altanmia Commercial Marketing Co.

Last month, Shaikh Ahmad said his government had nothing to do with the Halliburton case.

The minister said then that Kuwait had not breached any laws and that the local contractor was chosen by the Americans and not by state-run KPC, which is in charge of the oil sector in the Gulf Arab state. He also said the deal would be referred to the public prosecutor if there were any suspicions.

The Pentagon's inspector general is looking into whether Halliburton charged too much for fuel taken into Iraq. Trucking in fuel was part of a no-bid contract given to KBR by the US Army Corps of Engineers to rebuild Iraq's oil industry.

Halliburton has said KBR had closely followed procurement rules in Iraq, where one of its main jobs has been to deliver fuel to the civilian population.