Wednesday, April 30, 2008

New bid, same result: KBR shares big Army contract

WASHINGTON — Houston-based KBR has again been selected to participate in a 10-year military logistical support contract valued at up to $150 billion, the U.S. Army announced today.

The Army Sustainment Command, at the insistence of the Government Accountability Office, had re-evaluated its decision last summer to award the massive contract to KBR, Fort Worth-based DynCorp International and Fluor Intercontinental of Greenville, S.C.

But after rebidding the contract, the Army chose the same three players.

Currently, KBR has sole responsibility for providing support services to troops in Iraq, Afghanistan and other parts of the world, under a logistics contract valued at $27 billion. The bulk of that work — more than $24 billion obligated to date — has resulted from the U.S.-led occupation of Iraq, Army records show.

But when awarding the new contract this time around, Army officials opted to split up the contract work in the hopes of stimulating competition among the three participants.

The Rock Island, Ill.-based Army Sustainment Command awarded the newest logistics contract to KBR, DynCorp and Fluor last June, after taking bids from six companies.

Two firms on the losing end of that decision — IAP Worldwide Services and Contingency Management Group — filed protests.

After reviewing their complaints, the GAO found flaws in the Army's evaluation of the proposals from KBR and Fluor. Read more..

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