April 21, 2003 — The U.S. Agency for International Development awarded engineering giant Bechtel Corp. the first major contract for reconstruction efforts in Iraq.
The $34.6 million deal, awarded April 17, could top out at $680 million over 18 months and calls for emergency infrastructure and repair to the war-torn nation, which has suffered more than a decade of international economic sanctions.
Estimates for reconstruction range anywhere between $25 billion to $100 billion.
Halliburton subsidiary, Kellogg Brown & Root, has also been contracted by the Army Corps of Engineers to extinguish oil fires, a service that could fetch as much as $7 billion for the firm, but which is anticipated to be much less.
Bechtel, based in San Francisco, will be expected to assess and repair power grids as well as water and sewage systems. The contract also provides for restoring airport facilities and possibly dredging the Umm Qasr seaport – the major gateway for incoming food and supplies. Other work may include the repair and reconstruction of hospitals, schools and infrastructure.
AID said it expects Bechtel to engage subcontractors and the Iraqi population and work closely with other AID contractors.
Citing national security concerns, AID considered only a handful of U.S. corporations in a closed-bidding process that has ignited congressional concern and an investigation by the General Accounting Office.
