Scandal-plagued Halliburton, the oil services company once headed by Vice President Dick Cheney, has been working secretly with one of Iran’s top nuclear scientists on natural gas related projects and, allegedly, selling the scientists’ oil company key components for a nuclear reactor, according to Halliburton sources with intimate knowledge of both companies’ business dealings.
A recent National Security Council report said Iran was a decade away from acquiring a nuclear bomb. That time frame might have been significantly longer if Halliburton, which just reported a 284-percent increase in its fourth quarter profits due to its Iraq reconstruction contracts, were not actively providing the Iranian government with the financial means to build a nuclear weapon.
Now comes word that Halliburton, with its long history of flouting US law by conducting business with countries alleged to have ties to terrorism, has been working with Cyrus Nasseri, the vice chairman of Oriental Oil Kish – one of Iran’s largest private oil companies – on oil development projects in Tehran. Nasseri is also a key member of Iran’s nuclear development team.
Nasseri was interrogated by Iranian authorities in late July for allegedly providing Halliburton with Iran’s nuclear secrets, and accepting as much as $1 million in bribes from Halliburton, according to Iranian government officials.
It’s unclear whether Halliburton was actually privy to Iran’s nuclear activities. A company spokesperson did not return numerous calls for comment.
Oriental Oil Kish’s dealings with Halliburton became public knowledge in January when the company announced that it had subcontracted parts of the South Pars natural gas drilling project to Halliburton Products and Services, a Halliburton subsidiary registered in the Cayman Islands.
Following the announcement, Halliburton announced the South Pars gas field project in Tehran would be its last project in Iran. The BBC reported that Halliburton, which took in $30–$40 million from its Iranian operations in 2003, “was winding down its work due to a poor business environment.”
The US Senate approved legislation July 26 that would penalize companies that set up offshore subsidiaries as a way to legally conduct business in Libya, Iran, and Syria, and avoid US sanctions under International Emergency Economic Powers Act (IEEPA) (.pdf ~15K). The amendment, sponsored by Sen. Susan Collins, R-Maine, is part of the Senate Defense Authorization bill.
“The bottom line is that if a US company is evading sanctions to do business with one of these countries, they are helping to prop up countries that support terrorism – most often aimed against America,” Collins said.
Not surprisingly, a letter drafted by trade groups representing corporate executives vehemently objected to the amendment, saying it would lead to further hatred and perhaps incite terrorist attacks on the US and “greatly strain relations with the United States’ primary trading partners.”
“Extraterritorial measures irritate relations with the very nations the US must secure cooperation from to promote multilateral strategies to fight terrorism and to address other areas of mutual concern,” said a letter signed by the Coalition for Employment through Exports, Emergency Coalition for American Trade, National Foreign Trade Council, USA Engage, US Council on International Business and the US Chamber of Commerce. “Foreign governments view US efforts to dictate their foreign and commercial policy as violations of sovereignty, often leading them to adopt retaliatory measures more at odds with US goals.”
Still, Collins’ amendment has some holes. As Washington Times columnist Frank Gaffney pointed out in a July 25 story, “The Collins amendment would seek to penalize individuals or entities who evade IEEPA sanctions – if they are subject to the jurisdiction of the United States.”
Going a step further, Dow Jones Newswires reported that the US Securities and Exchange Commission sent letters in June to energy corporations demanding that the companies disclose in their security filings any business dealings with terrorist-supporting nations.
“The letters have been sent by the SEC’s Office of Global Security Risk, a special division that monitors companies with operations in Iran and other countries under US sanctions, which were created by the US Congress in 2004,” Dow Jones reported.
Investors have become increasingly concerned that they may be unwillingly supporting terrorist activity. In the case of Halliburton, the New York City Comptroller’s Office threatened in March 2003 to pull its $23 million investment in the company if Halliburton continued to conduct business with Iran.
The SEC letters are aimed at forcing corporations to disclose their profits from business dealings with rogue nations. Oil companies such as Devon Energy Corp., ConocoPhillips, Marathon Oil, and Occidental Petroleum that currently conduct business with countries that sponsor terrorism, have not disclosed the profits received from terrorist countries in their most recent quarterly reports because the companies don’t consider the earnings “material.”
Devon Energy was, until recently, conducting business in Syria. The company just sold its stake in an oil field there. ConocoPhillips has a service contract with the Syrian Petroleum Co. that expires December 31.
Jason Leopold is the author of the explosive memoir, News Junkie, to be released in the spring of 2006 by Process/Feral House Books. Visit Leopold’s Web site at www.jasonleopold.com for updates.
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