The Pentagon said the planned reimbursement followed a refund to the Army by the Texas-based company last month for $6.3 million after the company admitted its employees took kickbacks from a Kuwaiti subcontractor.

   

Potential overbilling for food served at bases in Iraq and Kuwait was identified by defence auditors during a routine evaluation of contract costs submitted by Halliburton subsidiary Kellogg Brown and Root.

   

"We are pleased that KBR is willing to step forward to offer reimbursement in advance of any findings," said the official, who asked not to be identified.

   

Halliburton could not be reached for comment, but the company said on Monday no conclusions had been reached over charging, and the company was working with the US military to improve its counting estimates for meals.

   

Under the spotlight

 

Run by Vice President Dick Cheney until he joined President George Bush as his running mate in 2000, Halliburton has become a lightning rod for Democratic criticism of Iraq contracts during the current presidential year.

   

New Jersey Democratic Senator Frank Lautenberg said it was time for Halliburton to be "reined in .... at this point, it seems that no matter what misconduct Halliburton engages in, the Bush Administration continues to turn a blind eye to it and issue more contracts."

   

"It seems that no matter what misconduct Halliburton engages in, the Bush Administration continues to turn a blind eye to it and issue more contracts"

Frank Lautenberg,
Democrat senator

The suspected overcharges took place at five military bases in Kuwait and Iraq over nine months last year, under a logistics contract that KBR has with the Army.

   

The spokesperson said auditors were now evaluating costs at 53 other dining halls in Iraq and Kuwait to ensure there had not been any overcharges there.

   

Inspection findings

 

Auditors found "discrepancies" that indicated the company had overcharged by more than $16 million for meals at a single military base in Kuwait.

   

Last Friday, KBR notified the Pentagon it would reimburse for these potentially and then on Monday it told the military it would pay back an additional $11.4 million to cover possible overcharges at four other bases, the Pentagon said.

   

The Pentagon said auditors were closely scrutinizing "all activities" done by KBR, adding that the military had been informed KBR had its own "Tiger team," or investigators, to evaluate and respond to these issues.

   

Largest contractor continues

 

KBR is the biggest contractor for the US military in Iraq and has more than $8 billion in contracts that cover tasks such as doing laundry, building bases, serving meals and helping to restore Iraq's oil industry.

   

The company has also been in the spotlight over whether it overcharged for fuel delivered to Iraq. That issue is being examined by the Pentagon inspector general's office.

   

The inspector general's office is also looking into the case of alleged kickbacks from a Kuwaiti subcontractor who was providing services to US troops in Kuwait.

   

The Pentagon spokesperson said the latest issue involving meals had nothing to do with the possible inquiry into fuel charges or the kickbacks.