U.S. Army to Award New Iraq Repair Contracts

The U.S. Army will issue at least two new competitive contracts for work to repair and rebuild Iraq's oil wells. These contracts will replace a previous contract awarded to Kellogg Brown & Root, a subsidiary of Halliburton. The KBR contract was awarded in March for emergency repairs to Iraq's oil well system was worth approximately $235 million as of June 20th, according to Army Lt. Col. Gene Pawlik. The contract was non-competitive and had a ceiling of $7 billion in the event of a worst-case scenario.

The contracts will cover a large portion of the work that the KBR contract covered. The army will issue either one or two contracts, depending on the amount of work left, each with a ceiling of $500 million for the life of the contract. Each contract has a minimum of $500,000. The army's preference is to issue two contracts, Pawlik said. The new work will continue to include extinguishing oil fires, if necessary, environmental assessment and cleanups as well as restoration of Iraq's oil well infrastructure, according to the pre-solicitation notice. The deadline for proposals is August. 14.

Lawmakers have complained loudly Halliburton has received more than $800 million for work in Iraq Most of that work has come from a 10-year contract called the Logistics Civil Augmentation Program (LOGCAP), awarded in 2001. Kellogg Brown & Root will still be able to bid on these new contracts.