- Sep 26, 2000
- 28,561
- 4
- 0
http://www.nytimes.com/2006/04/25/world...4000&partner=homepage&pagewanted=print
Rebuilding of Iraqi Pipeline as Disaster Waiting to Happen
The project, called the Fatah pipeline crossing, had been a critical element of a $2.4 billion no-bid reconstruction contract that a Halliburton subsidiary had won from the Army in 2003. The spot where about 15 pipelines crossed the Tigris had been the main link between Iraq's rich northern oil fields and the export terminals and refineries that could generate much-needed gasoline, heating fuel and revenue for Iraqis.
For all those reasons, the project's demise would seriously damage the American-led effort to restore Iraq's oil system and enable the country to pay for its own reconstruction. Exactly what portion of Iraq's lost oil revenue can be attributed to one failed project, no matter how critical, is impossible to calculate. But the pipeline at Al Fatah has a wider significance as a metaphor for the entire $45 billion rebuilding effort in Iraq. Although the failures of that effort are routinely attributed to insurgent attacks, an examination of this project shows that troubled decision-making and execution have played equally important roles.
The Fatah project went ahead despite warnings from experts that it could not succeed because the underground terrain was shattered and unstable.
It continued chewing up astonishing amounts of cash when the predicted problems bogged the work down, with a contract that allowed crews to charge as much as $100,000 a day as they waited on standby.
The company in charge engaged in what some American officials saw as a self-serving attempt to limit communications with the government until all the money was gone.
And until Mr. Sanders went to Al Fatah, the Army Corps of Engineers, which administered the project, allowed the show to go on for months, even as individual Corps officials said they repeatedly voiced doubts about its chances of success.
The Halliburton subsidiary, KBR, formerly Kellogg Brown & Root, had commissioned a geotechnical report that warned in August 2003 that it would be courting disaster to drill without extensive underground tests.
"No driller in his right mind would have gone ahead," said Mr. Sanders, a geologist who came across the report when he arrived at the site.
KBR defended its performance on the project, and said that the information in the geotechnical report was too general to serve as a warning.
Still, interviews by The New York Times reveal that at least two other technical experts, including the northern project manager for the Army Corps, warned that the effort would fail if carried out as designed. None of the dozen or so American government and military officials contacted by The Times remembered being told of the geotechnical report, and the company pressed ahead.
Once the project started going bad, senior American officials said, an array of management failures by both KBR and the Corps allowed it to continue. First, some of those officials said, they seldom received status reports from the company, even when they suspected problems and made direct requests.
"Typically when you manage a project, you have people who can tell you that you've got so much of your project finished and this much money that has been spent," said Gary Vogler, a senior American official in the Iraqi Oil Ministry. "We couldn't get anything like that."
Some warnings did in fact make their way to senior officials who could have stopped the project, said Donna Street, a Corps engineer who examined correspondence on the project after it failed. But neither the Corps nor the company seemed to act on them, Ms. Street said.
"It seems to me that there was pretty much an absence of anything," she said. "The reports went out. The questions were asked. But there was just no response."
An independent United States office, The Special Inspector General for Iraq Reconstruction, began an investigation of the project and issued a report earlier this year. It sharply criticized KBR for not relaying the problems, and concluded that "the geological complexities that caused the project to fail were not only foreseeable but predicted."
The company received a slap on the wrist when it got only about 4 percent of its potential bonus fees on the job order that contained the contract; there was no other financial penalty.
No wonder things are going so badly in the Iraqi reconstruction. Letting KBR run projects with no oversight is like putting a Republican in charge of the US budget.
Rebuilding of Iraqi Pipeline as Disaster Waiting to Happen
The project, called the Fatah pipeline crossing, had been a critical element of a $2.4 billion no-bid reconstruction contract that a Halliburton subsidiary had won from the Army in 2003. The spot where about 15 pipelines crossed the Tigris had been the main link between Iraq's rich northern oil fields and the export terminals and refineries that could generate much-needed gasoline, heating fuel and revenue for Iraqis.
For all those reasons, the project's demise would seriously damage the American-led effort to restore Iraq's oil system and enable the country to pay for its own reconstruction. Exactly what portion of Iraq's lost oil revenue can be attributed to one failed project, no matter how critical, is impossible to calculate. But the pipeline at Al Fatah has a wider significance as a metaphor for the entire $45 billion rebuilding effort in Iraq. Although the failures of that effort are routinely attributed to insurgent attacks, an examination of this project shows that troubled decision-making and execution have played equally important roles.
The Fatah project went ahead despite warnings from experts that it could not succeed because the underground terrain was shattered and unstable.
It continued chewing up astonishing amounts of cash when the predicted problems bogged the work down, with a contract that allowed crews to charge as much as $100,000 a day as they waited on standby.
The company in charge engaged in what some American officials saw as a self-serving attempt to limit communications with the government until all the money was gone.
And until Mr. Sanders went to Al Fatah, the Army Corps of Engineers, which administered the project, allowed the show to go on for months, even as individual Corps officials said they repeatedly voiced doubts about its chances of success.
The Halliburton subsidiary, KBR, formerly Kellogg Brown & Root, had commissioned a geotechnical report that warned in August 2003 that it would be courting disaster to drill without extensive underground tests.
"No driller in his right mind would have gone ahead," said Mr. Sanders, a geologist who came across the report when he arrived at the site.
KBR defended its performance on the project, and said that the information in the geotechnical report was too general to serve as a warning.
Still, interviews by The New York Times reveal that at least two other technical experts, including the northern project manager for the Army Corps, warned that the effort would fail if carried out as designed. None of the dozen or so American government and military officials contacted by The Times remembered being told of the geotechnical report, and the company pressed ahead.
Once the project started going bad, senior American officials said, an array of management failures by both KBR and the Corps allowed it to continue. First, some of those officials said, they seldom received status reports from the company, even when they suspected problems and made direct requests.
"Typically when you manage a project, you have people who can tell you that you've got so much of your project finished and this much money that has been spent," said Gary Vogler, a senior American official in the Iraqi Oil Ministry. "We couldn't get anything like that."
Some warnings did in fact make their way to senior officials who could have stopped the project, said Donna Street, a Corps engineer who examined correspondence on the project after it failed. But neither the Corps nor the company seemed to act on them, Ms. Street said.
"It seems to me that there was pretty much an absence of anything," she said. "The reports went out. The questions were asked. But there was just no response."
An independent United States office, The Special Inspector General for Iraq Reconstruction, began an investigation of the project and issued a report earlier this year. It sharply criticized KBR for not relaying the problems, and concluded that "the geological complexities that caused the project to fail were not only foreseeable but predicted."
The company received a slap on the wrist when it got only about 4 percent of its potential bonus fees on the job order that contained the contract; there was no other financial penalty.
No wonder things are going so badly in the Iraqi reconstruction. Letting KBR run projects with no oversight is like putting a Republican in charge of the US budget.
Facebook
Twitter