US firms get big Iraq deals

2004-03-12 12:02

Baghdad - Two US firms have won $1.1bn in contracts to help rebuild Iraq, and Washington will award a final eight major deals to companies from countries that supported the war effort in the coming days, a spokesperson said on Friday.

"The announcement for the other primary contracts - worth about $3.8bn - is expected soon," said Steven Susens, speaking for the Baghdad-based office that is managing US reconstruction funds in Iraq.

The US defence department late on Thursday awarded one contract with a ceiling of $500m to FluorAMEC to work on Iraq's patchy electricity sector.

The firm will "provide design-build services for construction, rehabilitation, operation, and maintenance of power generation facilities," the US Programme Management Office said in a statement released early on Friday.

A second contract for public works with a ceiling of $600m was given to Washington International/Black and Veatch Joint Venture.

The company will help repair Iraq's water infrastructure, which has suffered due to a combination of war-damage and 13 years of international sanctions.

The two contracts were the biggest to-date from a $5bn package earmarked specifically for construction projects in the war-battered country.

On Wednesday, the Pentagon awarded seven contracts worth more than $120m to US and British companies to manage the reconstruction projects in six sectors - electricity, public works, security and justice, transportation and communication, health and education and oil.

Congress has pledged $18.4bn for reconstruction in Iraq, more than a third of the $55bn the World Bank estimates will be necessary to get the country back on its feet.

But Washington infuriated many countries when it announced last year that primary rebuilding contracts would exclude war critics such as Canada, France and Germany, while primary contractors are free to hand out work to whomever they want.

The $18.4bn Iraq fund is destined for 2 363 projects and was unveiled with much fanfare by Washington in October, but Iraqis say it has had little real impact as unemployment remains high and living standards low.

Two separate deals worth $1bn have already been awarded to the US Army Corps of Engineers to rebuild Iraq's oil sector.

A further $6bn is being spent on non-construction schemes that are open to bids from all countries regardless of their war views.

- AFP