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By Reuters

Tuesday 01 June 2004

Washington - A newly unearthed Pentagon e-mail about Halliburton contracts in Iraq prompted fresh calls on Capitol Hill on Tuesday for probes into whether Vice President Dick Cheney helped his old firm get the deals.

The e-mail, reported by Time magazine, provided "clear evidence" of a relationship between Cheney and multibillion-dollar contracts Halliburton has received for rebuilding Iraq, Sen. Patrick Leahy said.

"It totally contradicts the vice president's previous assertions of having no contact" with federal officials about Halliburton's Iraq deals, Leahy, a Vermont Democrat, said in a conference call set up by John Kerry's presidential campaign. "It would be irresponsible not to hold hearings."

The March 2003 Pentagon e-mail says action on a no-bid Halliburton contract to rebuild Iraq's oil industry was "coordinated" with Cheney's office. Cheney was chief executive officer of the oilfield services giant from 1995 until he joined George W. Bush's presidential ticket in 2000.

New Jersey's Sen. Frank Lautenberg, another Democrat, urged the chair of the Senate Governmental Affairs Committee, Republican Sen. Susan Collins, to subpoena e-mails and any other evidence of contacts between the U.S. Army Corps of Engineers and Cheney's office on Halliburton's Iraq contracts.

"The revelation that the Vice President's office was involved in the awarding of this contract ... makes the need for an investigation essential," Lautenberg wrote to Collins.

Cheney's office denied over the weekend that it had any role in the Halliburton contracts, and a senior adviser to the Bush-Cheney campaign, Mary Matalin, repeated this on Tuesday.

"The vice president had no operational involvement with letting of any contracts," she said on NBC's "Today" show.

Rumsfeld's Role Criticized
On the other side of Capitol Hill, Rep. Henry Waxman, a California Democrat, wrote to Defense Secretary Donald Rumsfeld suggesting he also helped steer Iraq oil work to Halliburton.

Waxman said the General Accounting Office, the audit arm of Congress, told him the oil work should have been obtained competitively.

The Army knew this, Waxman said the GAO had told him. But, he wrote Rumsfeld, "your office overruled the Army and directed Army officials to issue the task order to Halliburton."

Lautenberg, Waxman and several other Democrats have called for months for hearings into details of U.S. government deals involving Halliburton, the biggest contractor in Iraq.

U.S. officials have estimated the Texas company's Iraq deals, for everything from oil repairs to meals for the troops, could eventually total some $18 billion.

But only the majority party can call hearings. Republicans, who control both houses of Congress, have refused.

Senate Majority Leader Bill Frist told reporters he was not familiar with the Time report and "it would premature for me to say whether we need hearings."

Pentagon spokesman Larry DiRita noted that there had been congressional hearings on rebuilding Iraq which included discussions of reconstruction contracts.

He said the Pentagon e-mail was discussing how to announce a decision made months earlier to give Halliburton the no-bid contract, and that Cheney had no involvement in the decision.

The March 2003 no-bid contract handed out by the U.S. Army Corps of Engineers promised the company about $2.5 billion for rebuilding Iraq's oil industry. It was replaced in January 2004 by two contracts totaling $2 billion, with Halliburton retaining work in southern Iraq for $1.2 billion.

Time said it located the e-mail among documents provided by Judicial Watch, a watchdog group. The e-mail was sent by an Army Corps of Engineers official on March 5, 2003.

It said Douglas Feith, who reports to Deputy Defense Secretary Paul Wolfowitz, approved arrangements for the contract to rebuild Iraq's oil industry "contingent on informing WH (White House) tomorrow. We anticipate no issues since action has been coordinated w VP's office."

A former deputy defense secretary from the mid-1990s, John White, said the e-mail showed unprecedented political input on Pentagon contracts. An official like Feith, an undersecretary for policy, should not be handling contracts, he said. "I've never heard of anything like this before."

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