Citing a 25 August memo from the Army’s Chief of Procurement Policy Tina Ballard, the paper indicated top officials were “to immediately begin the transition to competitively awarded sustainment contracts for support of U.S. military forces in Iraq”.
The WSJ quoted a Pentagon insider saying, “The intention in Iraq is to break up Halliburton’s work into six or more smaller contracts, and complete the bidding process by the year-end. The exact timing would be left up to Central Command, which oversees Iraq military operations.”
According to the WSJ, “The Army is frustrated with efforts to estimate the final cost of the work and may stop negotiating contract costs with KBR, and instead estimate costs on its own.”
In reply, Halliburton spokeswoman Wendy Hall said, “The move was expected. KBR will consider bidding for parts of the work as the award fee is where you make your money.”
“Halliburton views the Army’s decision as positive and will help to resolve outstanding issues but KBR’s contract has provisions allowing the unit to dispute final Army estimates,” added Hall.
Halliburton and KBR have been accused of overcharging on the contract and only last month, as reported by Energyreview.net, Pentagon auditors were urging the US Army to withhold the remaining 15% of Halliburton’s Iraq bills as the firm could not account accurately for US$1.82 billion of its US$4.3 billion bill.
