May 12th, 2010
06:11 PM ET

Pentagon contracts went to companies with Iran business

The Pentagon has signed nearly $900 million in contracts with European and Asian companies that also do business with Iran's energy sector, congressional investigators told a Senate committee Wednesday.

About 90 percent of the $879 million in contracts were for fuel and oil for U.S. forces overseas between 2005 and 2009, according to a new report from the Government Accountability Office, the investigative arm of Congress. The Pentagon told GAO investigators that the contracts were "critical to meeting mission requirements," the report states.

Four of the seven companies named in the report were oil companies - Spain's Repsol, Italy's ENI, France's Total and Thailand's PTT. The remaining three were South Korean construction companies that built offices or housing for U.S. troops stationed there.

The report was prepared for the chairman of the Senate Homeland Security and Governmental Affairs Committee, Connecticut independent Joseph Lieberman, and its ranking Republican, Susan Collins of Maine, as well as Arizona Sen. Jon Kyl, the ranking Republican on the Senate Judiciary subcommittee on homeland security. It comes as Congress considers whether to stiffen U.S. sanctions on Iran, which Washington has accused of trying to develop a nuclear bomb.

Under U.S. laws that impose sanctions on Iran, companies that invest more than $20 million in Tehran's energy industry in any given year may be banned from U.S. government contracts. But GAO staffers did not attempt to determine whether any of the companies named in the report met that standard, the report says.

While rich in crude oil, Iran's refining and natural gas industries have lagged behind other nations in the region. Proposed legislation would allow the U.S. government to impose new sanctions targeting those industries as well as others - but the report notes that the only time a company has been cited under the Iran Sanctions Act, those penalties were waived.

Iran already faces international sanctions over its refusal to halt the production of enriched uranium, which in extremely high concentrations can be used to produce a nuclear bomb. The Islamic republic says its nuclear research is aimed at building a civilian energy program and for medical use, but the International Atomic Energy Agency has said it cannot verify that its goals are "exclusively peaceful."

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Filed under: Iran • Military • U.S.
soundoff (8 Responses)
  1. Mic

    Well the legacy of the war in Iraq and Afghanistan, Military Industrial Complex, what Eisenhower warned us about.

    May 12, 2010 at 8:53 pm | Report abuse |
  2. uradragon

    "But GAO staffers did not attempt to determine whether any of the companies named in the report met that standard, the report says"

    I can't imagine there will be any accountability with regard to the incompetence exhibited. It is after all only the tax payers money,

    May 12, 2010 at 10:12 pm | Report abuse |
  3. DreadedBeauty

    If this is a suprise to anyone, WAKE UP

    May 12, 2010 at 11:08 pm | Report abuse |
  4. roland

    This is no surprise. Everybody do business wiith somebdy as long they profit. It's called business.
    But I believe we should cut ties and business along with Iran and their associates.

    May 13, 2010 at 4:03 am | Report abuse |
  5. wcb2009

    Interesting how money transcends everything...

    The Iranians supplying the forces they hate so much?

    The US helping the evil iranians turn a profit?

    May 13, 2010 at 8:29 am | Report abuse |
  6. heretical monkey

    The IAEA cannot guarantee its use is exclusively peaceful, well that's good enough for me: )
    Haha, Not.

    May 13, 2010 at 11:43 am | Report abuse |
  7. Lilly Bell

    i was a former employee and now i am making my best effort to start up a small business.'~`

    May 19, 2010 at 1:37 am | Report abuse |
  8. Aaliyah Wood

    i love to make money that is why i focus both in online and offline business investment`.`

    October 7, 2010 at 3:18 pm | Report abuse |