Playing with fire: Halliburton’s ties with terrorism

A company spokesperson did not return numerous calls for comment. A White House spokesperson also did not return calls for comment.

In 1991, Halliburton sold Libya, another country that sponsors terrorism, nuclear detonator devices. As a consequence, the company was forced to pay more than $3 million in fines for violating a US trade embargo that President Reagan imposed in 1986 because of Libya's ties to terrorist activities.

Oriental Oil Kish 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 subsidiary of Dallas-based Halliburton that is registered in the Cayman Islands.

Following the announcement, Halliburton said the South Pars gas field project in Tehran would be its last project in Iran. The BBC reported that Halliburton, which took in US$30-$40 million from its Iranian operations in 2003, “was winding down its work due to a poor business environment”.

Halliburton, under mounting pressure from lawmakers in Washington, DC, pulled out of its deal with Nasseri's company in May, but has done extensive work on other areas of the Iranian gas project and was still acting in an advisory capacity to Nasseri's company, according to two people who have knowledge of Halliburton's work in Iran.

In an attempt to curtail other US companies from engaging in business dealings with rogue nations, the Senate approved legislation on July 26 that would penalise companies that continue to skirt US law by setting 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). The amendment, sponsored by Sen. Susan Collins, R-Maine, is part of the Senate Defense Authorization Bill.

“It prevents US corporations from creating a shell company somewhere else in order to do business with rogue, terror-sponsoring nations such as Syria and Iran,” Collins said in a statement. "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," she said.

The United States law currently does not prohibit foreign subsidiaries from conducting business with rogue nations provided that the subsidiaries are truly independent of the parent company. But Halliburton’s Cayman Island subsidiary never did fit that description.

Halliburton first started doing business in Iran as early as 1995, in possible violation of US sanctions, while Vice President Cheney was chief executive of the company.

According to a February 2001 report in the Wall Street Journal, “Halliburton Products & Services Ltd works behind an unmarked door on the ninth floor of a new north Tehran tower block. A brochure declares that the company was registered in 1975 in the Cayman Islands, is based in the Persian Gulf sheikdom of Dubai and is non-American. But, like the sign over the receptionist's head, the brochure bears the company's name and red emblem, and offers services from Halliburton units around the world.”

Moreover, mail sent to the company’s offices in Tehran and the Cayman Islands is forwarded to the company’s Dallas headquarters.

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 United States and “greatly strain relations with the United States’ primary trading partners”.