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Bribery Probe Of Halliburton Unit

A subsidiary of Halliburton Co. is under scrutiny by the Justice Department over allegations that it was involved in payment of $180 million in bribes to win a natural gas project contract in Nigeria. Vice President Dick Cheney was head of Halliburton at the time.

The $4 billion Nigerian Liquified Natural Gas Plant was built in the 1990s by a consortium that included Kellogg, Brown & Root, a unit of Houston-based Halliburton.

Two senior Justice Department officials, speaking Wednesday on condition of anonymity, said the department had asked that Halliburton voluntarily provide documents related to the allegations. Those records, they said, could determine whether a full investigation is launched.

Halliburton has complied with the request, the officials said. One factor in the Justice Department's decisions on whether to press corporate fraud charges is whether the company is cooperative.

Halliburton, already under fire for its handling of contracts related to the war in Iraq, disclosed the Justice Department request in a Jan. 21 filing with the Securities and Exchange Commission.

A French magistrate, Renaud Van Ruymbeke, also is investigating the Nigerian payments. He has said in a memo that embezzlement charges could be filed against Cheney in Paris. Cheney's aides have refused comment on the allegations.

A telephone call seeking comment Wednesday from Cheney's office was not returned.

According to Halliburton's SEC filing, the illegal payment allegations involve a joint venture of which KBR was a 25 percent owner. The other partners were Technip SA of France, ENI SpA of Italy and Japan Gasoline Corp.

The filing says the Justice Department and Securities and Exchange Commission are reviewing the allegations under the Foreign Corrupt Practices Act. The payments for the gas plant contract were allegedly made to Nigerian officials.

"Halliburton has engaged outside counsel to investigate any allegations and is cooperating with the government's inquiries," the company said in the filing. "If illegal payments were made, this matter could have a material adverse effect on our business and the results of operations."

Halliburton's troubles do not stop there. The Defense Department is conducting a criminal probe into the Houston-based company's contract to supply gasoline to Iraqi civilians.

Last month, KBR reimbursed the Pentagon $6.3 million after disclosing that two employees had taken kickbacks from a Kuwaiti subcontractor in return for providing services to U.S. troops in Iraq.

KBR also has agreed to reimburse the Pentagon more than $27 million for overcharges on meals served at military dining facilities in Iraq and Kuwait.

Halliburton has complained repeatedly that criticism of its work in Iraq is politically motivated, in part because of its past ties with Cheney, the company's chairman from 1995 to 2000.

By Curt Anderson

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