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Sun 15 Apr 2007 12:00 AM

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Halliburton: reconstruction racket

Each week Arabian Business turns the spotlight on a leading company.

They're a US company, right?

Not any more. Well, not really. Actually, no one's totally sure. They're relocating to Dubai, but then they'll still be subject to US laws. One thing's for sure - Halliburton will be headquartered in the emirate, and their chairman and CEO David J Lesar will be based in Dubai too.

And what will they be doing once they're here?

Halliburton is one of the largest providers of products and services to the oil and gas and military services industries. The world's second largest energy services provider is also a dab hand at rebuilding war-torn countries.

That's nice of them.

Well... they've done quite well out of it, actually. Halliburton have secured Iraq reconstruction contracts totalling more than US$25bn, making them the greatest such beneficiary of the war.

Wow. So if they're doing so well, then why are they relocating?

I guess they want to be closer to the action, so to speak. Middle East oil is where it's at, so it makes sense for Halliburton to be near to the state-owned oil companies of the Gulf.

That's a blow for the US, surely?

The news caused uproar on Capitol Hill, with senators demanding to know whether the move was one massive tax dodge. Senator Hillary Rodham Clinton, who is running to be the next president, was particularly splenetic: "They get a lot of government contracts - is this going to affect the investigation going on? We have a lot of evidence of misuse of government contracts, and how they have cheated the American soldier, and cheated the American taxpayer."

What on earth is she talking about?

It's a touchy subject. Halliburton is actually under US Justice Department Securities and Exchange Commission investigation over allegations of improper dealings in Iraq, Kuwait and Nigeria.

I don't believe it. Improper dealings?!

It is alleged that over US$2.7bn paid to Halliburton and its subsidiaries and subcontractors for work done in Iraq was either excessive or unsupported. Plus, their relationship with the current US vice president Dick Cheney has come under scrutiny from senators.

How is he involved?

He's not, according to Halliburton - it's just that he was their CEO from 1995 to 2000. Critics are claiming that there is clear evidence of an ongoing relationship between Cheney and the multibillion-dollar contracts Halliburton has received for rebuilding Iraq.

So they've got friends in high places?

Those are the allegations. Mind you, if Halliburton do indeed have an inside man at The White House, then it might be worth taking note of last week's developments. Halliburton announced that they were pulling out of Iran, pronto.

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