Halliburton accused of overcharging US government

22 October 2003
Democrat representatives in the US on 21 October released a letter from the Iraq National Oil Company confirming that it pays less to import oil from neighbouring countries than US' Halliburton subsidiary Kellogg Brown Root (KBR), which has been purchasing oil with US government money. At present, KBR charges Washington $1.59 a gallon, and receives a mark-up that could boost the price to $1.62 or $1.70, said Democrats Henry Waxman and John Dingell. Iraq's State Oil Marketing Organisation pays in the region of $0.90 and $0.98 cents a gallon. Halliburton responded to the allegation by saying that its prices reflected the short-term nature (30-day) of its contracts with suppliers. 'Simple economics dictate that companies who are not bound by these guidelines, and are able to negotiate price on a long-term contract basis, can negotiate lower prices,' said KBR spokeswoman Wendy Hall in a written statement. 'Based on the entire picture, to allege that KBR is overcharging for this needed service insults the KBR employees who are performing this dangerous mission to help bring fuel to the people of Iraq.'(MEED 3:10:03)

A MEED Subscription...

Subscribe or upgrade your current MEED.com package to support your strategic planning with the MENA region’s best source of business information. Proceed to our online shop below to find out more about the features in each package.

Get Notifications