Ok, my headline.
http://story.news.yahoo.com/news?tmpl=story&u=/nm/20040106/us_nm/energy_halliburton_dc_8
sure.
http://story.news.yahoo.com/news?tmpl=story&u=/nm/20040106/us_nm/energy_halliburton_dc_8
sure.
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Haliburton OK'd To Do Whatever The Fuck They Want
- Thread starter Adam
- Start date
Subsonic Chronic
TRIBE Member
There was a similar story a while back about how the U.S. had granted Haliburton basically a carte blanche to do whatever the fuck they want, including violating laws, in order to keep the oil/money flowing.
http://asia.news.yahoo.com/031213/ap/d7vd7oo00.html
(near the end of the article)
"Halliburton is guaranteed a profit equal to at least two percent of its costs. Depending on performance, Halliburton can earn a profit of up to 7 percent of costs. "
(near the end of the article)
"Halliburton is guaranteed a profit equal to at least two percent of its costs. Depending on performance, Halliburton can earn a profit of up to 7 percent of costs. "
HALLIBURTON'S BUILT-IN GOUGE
1/5/2004
http://www.jimhightower.com/air/read.asp?id=11268
Dick Cheney's old company, Halliburton, keeps getting stuck in its own Iraqi sand pit – and Cheney and his sidekick George W are stuck there, too.
Halliburton, which continues to pay about $150,000 a year to its old CEO Cheney, was first in line to get multi-billion-dollar, no-bid contracts from the Bush-Cheney regime for occupying and rebuilding Iraq. But don't think that any political favoritism was involved. No, no, Bush officials say, it's just that Dick's old company was the only one in the whole wide world qualified to do the job. Imagine, the only one.
And what a job it has done! Take it's contract for providing gasoline to Iraqis. An audit shows that the Houston-based giant has already gouged us taxpayers by as much as $61 million on this no-bidder. It's been charging the Pentagon $2.64 a gallon to haul gasoline from nearby Kuwait. Well, yes, say the Bushites, that's expensive, but, hey, it's costly to deliver gas in a combat zone.
Before you swallow that, though, note that the Pentagon's own energy support center delivers gasoline from Kuwait to Iraqi pumps in exactly the same war conditions for under a buck-twenty a gallon – less than half of Halliburton's charge. And Iraqi's own state oil company does the same job for under a dollar a gallon.
Caught in Halliburton's web of deceit, George W is now trying to get on the high road, declaring that "If there's an overcharge... we expect that money to be repaid." Repaid? What about charging his and Cheney's no-bid cronies with fraud?
But here comes the real stinker: Halliburton's contract from the Bushites actually gives the company an incentive to overcharge us taxpayers. It guarantees a profit to Halliburton of between two and seven percent of its costs – meaning that the more cost it can put into each gallon, the more profit Halliburton gets.
It's a built-in gouge, brought to us by Bush and Cheney, who like to claim that they're running our government like a business.
--------------------------------------------------------------------------------
"Evidence Is Cited Of Overcharging In Iraq Contract, New York Times, December 12, 2003.
"High Payments To Halliburton For Fuel in Iraq," New York Times, December 10, 2003.
"Bush: Halliburton Must Pay for Overcharge," Austin American-Statesman, Decmeber 14, 2003.
1/5/2004
http://www.jimhightower.com/air/read.asp?id=11268
Dick Cheney's old company, Halliburton, keeps getting stuck in its own Iraqi sand pit – and Cheney and his sidekick George W are stuck there, too.
Halliburton, which continues to pay about $150,000 a year to its old CEO Cheney, was first in line to get multi-billion-dollar, no-bid contracts from the Bush-Cheney regime for occupying and rebuilding Iraq. But don't think that any political favoritism was involved. No, no, Bush officials say, it's just that Dick's old company was the only one in the whole wide world qualified to do the job. Imagine, the only one.
And what a job it has done! Take it's contract for providing gasoline to Iraqis. An audit shows that the Houston-based giant has already gouged us taxpayers by as much as $61 million on this no-bidder. It's been charging the Pentagon $2.64 a gallon to haul gasoline from nearby Kuwait. Well, yes, say the Bushites, that's expensive, but, hey, it's costly to deliver gas in a combat zone.
Before you swallow that, though, note that the Pentagon's own energy support center delivers gasoline from Kuwait to Iraqi pumps in exactly the same war conditions for under a buck-twenty a gallon – less than half of Halliburton's charge. And Iraqi's own state oil company does the same job for under a dollar a gallon.
Caught in Halliburton's web of deceit, George W is now trying to get on the high road, declaring that "If there's an overcharge... we expect that money to be repaid." Repaid? What about charging his and Cheney's no-bid cronies with fraud?
But here comes the real stinker: Halliburton's contract from the Bushites actually gives the company an incentive to overcharge us taxpayers. It guarantees a profit to Halliburton of between two and seven percent of its costs – meaning that the more cost it can put into each gallon, the more profit Halliburton gets.
It's a built-in gouge, brought to us by Bush and Cheney, who like to claim that they're running our government like a business.
--------------------------------------------------------------------------------
"Evidence Is Cited Of Overcharging In Iraq Contract, New York Times, December 12, 2003.
"High Payments To Halliburton For Fuel in Iraq," New York Times, December 10, 2003.
"Bush: Halliburton Must Pay for Overcharge," Austin American-Statesman, Decmeber 14, 2003.
You kidding, Haliburton was on the brink of Bankruptcy the year before the contract.. this contract was a fuckin lifeline for them.. 2% of whatever they get to charge in a NO BID GOVERNMENT REBUILDING TAX FUNDED contract is fuckin gold for a corporation!
It's a dream of guaranteed growth for a long long time. For any corproation it's a hugely very lucritive deal with 0 risk.
It's a dream of guaranteed growth for a long long time. For any corproation it's a hugely very lucritive deal with 0 risk.
I don't know enough about the specifics of this contract (ie., what exactly they are being contracted to do) but it seems the majority of the work is centred around delivering fuel to Iraq. If the company is not building any signficant infrastructure under this contract (ie., investing capital), but merely earning a 2% markup on its deliveries, then Halliburton is definitely earning a very good return on capital.
I'm no expert on specific aspects about contract bidding, however I understand the obligations that senior management has vis a vis adequate capital returns. I think if you view it in those terms, the deal probably works out something like this;
Labour: 1000 contractors equals about 100 million in sales, and 20 million in capital outlays (payroll, etc)...probably only making 2%-7%, plus the cost of capital (6-8%) on each contractors pay, unless its project specific, then it would be on the whole project.
Capital: Total capital committed, total cost, plus cost of capital, plus 2%, minimum. So if the bridge costs $1billion, built into that (or on top, I'm not sure), is the 6-8% cost of capital (probably charged from the Haliburton holding company, to the subsidiary doing the work (ie, Kellog,Brown and Root)), plus the scaled profit margin of 2-7%. So figure on a 1 billion dollar capital commitment, Haliburton will make anywhere from 8% to 15-16%...
As well, I suspect Haliburton has built in a number of favourable assumptions about their costs, probably pushing up their margins.
That being said, if the contract does cap out at 7%, it's not a fantastic deal, but no one would turn it down, that's for sure. Long-term, it's probably a big plus for HAL because it will insure their presence in Iraq for a very, very long time.
Labour: 1000 contractors equals about 100 million in sales, and 20 million in capital outlays (payroll, etc)...probably only making 2%-7%, plus the cost of capital (6-8%) on each contractors pay, unless its project specific, then it would be on the whole project.
Capital: Total capital committed, total cost, plus cost of capital, plus 2%, minimum. So if the bridge costs $1billion, built into that (or on top, I'm not sure), is the 6-8% cost of capital (probably charged from the Haliburton holding company, to the subsidiary doing the work (ie, Kellog,Brown and Root)), plus the scaled profit margin of 2-7%. So figure on a 1 billion dollar capital commitment, Haliburton will make anywhere from 8% to 15-16%...
As well, I suspect Haliburton has built in a number of favourable assumptions about their costs, probably pushing up their margins.
That being said, if the contract does cap out at 7%, it's not a fantastic deal, but no one would turn it down, that's for sure. Long-term, it's probably a big plus for HAL because it will insure their presence in Iraq for a very, very long time.
In most contracts, the proponent assumes risk for any cost overruns relative to the initial estimates. Some costs may be passed through if they are outside of the proponent's control (ie,. if the commodity price of gasoline increases) but usually higher delivery costs would be absorbed as a loss. It seems the problem with this particular contract is that Halliburton does not assume any cost risk for delivery of gasoline.
Halliburton deal 'violated rules on procurement'
By Joshua Chaffin in Washington
Published: June 2 2004 5:00 | Last Updated: June 2 2004 5:00
The Pentagon violated federal procurement rules when it awarded Halliburton, the oilfield services company formerly headed by Dick Cheney, US vice-president, a multi-billion dollar contract to repair Iraq's oil infrastructure, according to people briefed on a pending report by congressional auditors.
The deal raised objections within the army, according to these people, but they were overruled by the office of Donald Rumsfeld, defence secretary.
Halliburton deal 'violated rules on procurement'
By Joshua Chaffin in Washington
Published: June 2 2004 5:00 | Last Updated: June 2 2004 5:00
The Pentagon violated federal procurement rules when it awarded Halliburton, the oilfield services company formerly headed by Dick Cheney, US vice-president, a multi-billion dollar contract to repair Iraq's oil infrastructure, according to people briefed on a pending report by congressional auditors.
The deal raised objections within the army, according to these people, but they were overruled by the office of Donald Rumsfeld, defence secretary.
Halliburton deal 'violated rules on procurement'
wayne kenoff
TRIBE Member
holy fuck.. FINALLY! some accountability. this is not going to wash with conservatives. that's corruption plain and simple.
Yeah, remember when we threatened to withhold payments? Never mind, here you go.
http://www.cbc.ca/story/world/national/2004/08/18/KBR040818.html
http://www.cbc.ca/story/world/national/2004/08/18/KBR040818.html