By Jackie Spinner
Washington Post Staff Writer
Tuesday, February 3, 2004; 4:18 PM

The Defense Department said today that Halliburton Co. will reimburse the government $27.4 million for potential overcharges related to food services in Iraq and Kuwait.

The amount includes $16 million that a Halliburton unit may have overcharged for meals it never served at Camp Arifjan in Kuwait, as well as $11.4 million in previously undisclosed overcharges at four other dining facilities in Kuwait and Iraq.

Lt. Col. Rose-Ann L. Lynch, a Pentagon spokeswoman, said Defense auditors also are reviewing billing at 53 other dining facilities that the Halliburton unit, KBR, operates through subcontractors in both Iraq and Kuwait.

She said the potential overbillings, which took place during a nine-month period last year, were discovered "during routine evaluation of contract costs submitted for payment."

Halliburton said on Monday that it would temporarily delay billing the government for food services until it can improve counting methods that may have led to the overcharging.

"KBR has a responsibility to clients and it is important to understand that this is not any sort of admission," Wendy Hall, a Halliburton spokeswoman, said today in an e-mail. "It is an agreement to temporarily delay billing while KBR and the government jointly determine the best way to estimate how many meals to prepare."

The potential overcharge at Camp Arifjan, a new base that the Kuwaiti government built for the U.S. military to replace temporary facilities at Camp Doha, involved a Saudi Arabian firm, Tamimi Global Co.

Tamimi is a primarily a commercial construction company with an estimated 8,700 employees, according to a 2003 credit report. It is also a subcontractor for Bechtel National Inc., which hired the Saudi company to run a base camp in Baghdad for 90 employees.

"They're doing a good job for us," said Francis Canavan, a spokeswoman for Bechtel, which has a prime U.S. contract to repair Iraq's infrastructure.

KBR runs dining facilities for soldiers and civilians under a broad Defense Department contract it won in 2001 to provide food, shelter and other logistical support to the U.S. military throughout the world. The company has been awarded $3.8 billion in work under the contract.

Last week, Halliburton said it would repay the government $6.2 million to cover potential overcharges by another subcontractor under the same broad contract. The amount covered the possible overbilling by an unnamed Kuwaiti firm as well as potential kickbacks to one or two KBR employees.

Pentagon auditors also are reviewing whether KBR may have overcharged the government at least $61 million to import fuel from Kuwait into Iraq under a separate contract with the U.S. Army Corps of Engineers.

KBR has denied wrongdoing in each instance.

Staff researcher Richard Drezen contributed to this report.