Iraq Reconstruction Continues Amid Danger

Mon August 23, 2004 - National Edition
Pete Sigmund

Despite attacks and assassinations, the rebuilding of Iraq’s decayed infrastructure is moving painfully ahead.

Few construction projects are as important. Fully functional power, water, telephone and other basic services are key to holding support among the Iraqi people. They also are essential to building a vibrant economy, which many consider a linchpin for democratizing the nation and the Middle East.

The planning and support for Iraq reconstruction is so critical that its effectiveness may become a pivotal election issue.

Some would say that this nationwide reconstruction project is “the heart of the matter” in Iraq as reconstruction proceeds quietly (and often heroically) against a backdrop of the violence that has commanded world attention. The threat of violence is so bad now that the United States isn’t discussing reconstruction projects by specific name because it might aid terrorists.

Here’s a summary of Iraq reconstruction progress, updating Construction Equipment Guide’s (CEG) previous articles in May 2003, and November 2003.

Spent $3.3 Billion in One Year

In the 12 months between April 2003, when U.S.-led forces toppled Saddam Hussein, and April 2004, the U.S. spent $3.3 billion in emergency relief and reconstruction for Iraq. Despite attacks by dissidents, including Muslim fundamentalists, Iraq continues to be the largest U.S. foreign aid program since the Marshall Plan rebuilt Europe after World War II.

“Progress slowed down somewhat, to protect the safety of people, about five months ago but not to a screeching halt,” said Jose Fuentes, a spokesperson in Washington, D.C., for the U.S. Agency for International Development (USAID) — part of the Department of State — which is directing the infrastructure reconstruction.

“Insurgents went after basic things like water and electricity in order to cause major inconvenience. However, we’re still in the thick of things; we still have people on the ground; none of our projects have been shut down. We never pulled out anybody. Nor did our contractors.

“I think a lot of people think that all this work stopped. That’s not true. It’s still ongoing. It’s low-key for the protection of everybody. By low key I mean we are not advertising what we are doing. For example, our publications say we are reconstructing a building in Southern Iraq. If we say we are constructing a building in Mosul, that puts the task in jeopardy because insurgents may try to attack. So basically we are announcing our projects and what we are doing but not giving specifics as to where.”

Bechtel Directs Infrastructure Projects

In the infrastructure-rebuild effort, USAID awarded a “Phase II $1.8-billion contract to Bechtel National Inc., the government services business unit of the Bechtel Group in San Francisco, CA, on Jan. 6, 2004.

“The contract focuses on power, water and buildings,” said Greg Pruett, public affairs manager in Baghdad for USAID’s Iraq Infrastructure Reconstruction Program (IIRP) replying to CEG’s e-mail questions.

Phase II covers Bechtel’s work in Iraq for the two years between Jan. 6, 2004 and Dec. 31, 2005.

USAID’s earlier Phase I contract with Bechtel runs through Dec. 31, 2004. This $1.03-billion contract, awarded April 17, 2003, “focuses on eight key infrastructure sectors: power, water, wastewater, ports, rail, roads and bridges, buildings and facilities, and telecommunications.”

“Bechtel’s role in the USAID reconstruction effort is to manage and provide project oversight,” Pruett said. “Since the beginning of the Phase I contract, a total of 159 out of 230 contracts [approximately 70 percent] have been awarded to 120 Iraqi subcontractors. This trend is continuing for Phase II, which has started awarding contracts.”

Bechtel’s Web site ( says the company is assuring successful design, rehab, reconstruction and construction projects in the eight sectors with a secondary objective of providing “numerous employment opportunities for Iraqis and Iraqi firms, thereby injecting much-needed capital into the economy.”

The effort obviously reaches almost all areas of infrastructure except petroleum. The Web site says, for instance, that Bechtel “will also repair and build government and public facilities including schools, selected ministry buildings and major irrigation structures, as well as essential transportation links.”

Bechtel is teamed with Parsons Corp., of Pasadena, CA, and Home Engineering Services Inc., of Fairfax, VA, for its Iraq reconstruction projects.

More Power

Restoring and improving Iraq’s electricity supply remains the largest and most costly infrastructure effort. After repairs boosted power output more than pre-war levels of 4,400 megawatts (MW) last October, electricity production was expected to reach 6,000 MW by this summer. It hasn’t happened.

“The 6,000 MW was a CPA [Coalition Provisional Authority] goal and unfortunately we didn’t hit that,” Fuentes told CEG. “Everyone is working hard to make sure it happens this year.”

In its new brochure, “A Year in Iraq,” now available on its Web site (, USAID said that “saboteurs and thieves have frequently destroyed pylons and stolen copper wiring from the power transmission lines that link Baghdad with the north and the south of the country,” adding, “In an effort to block the restoration of power, attackers had tried to cut the pipelines supplying fuel to some power plants as well as the electric power cables sending power to the cities. Coalition forces have been able to train Iraqis to provide security for those vial fuel and power conduits.

“While total electric power output continued to climb, it was distributed in a new way. Under the old regime, most of Iraq had only a few hours of power a day. Outlying regions were required to send power to Baghdad, which enjoyed electricity almost 24 hours a day. The smaller cities such as Basrah had power only a couple of hours each day. Now power is more evenly shared, even if Baghdad residents may feel they have less hours of power than they enjoyed in the past.

“Power is also growing at a time when demand is spiking due to booming sales of electric appliances, from refrigerators to air conditioners to satellite televisions, since Iraq’s central controls and trade isolation has ended.”

Asked whether fuel lines to utility plants, and power cables to cities, are a prime target for terrorists, Pruett replied in his e-mail, “Bechtel, for security reasons, does not discuss what may be terrorist targets. We feel the best way to ensure the safety of our employees, and the safety of our Iraqi subcontractors, is to minimize discussion of issues involving security, or specific facility details, such as name and location.”

Pruett also wrote, “The reconstruction of Iraq’s electric infrastructure is part of a larger effort by the U.S. Corps of Army Engineers, Washington Group International, Fluor, and Perini. Bechtel is also performing work in this sector on behalf of USAID.”

Pruett added that the milliwatt figure by itself is less significant than milliwatt hours (MWhrs), explaining, “MWhrs indicate how much power is being consumed [or delivered], whereas milliwatts only indicate how much power can be produced at maximum output of a given facility. In other words, if a 1,000 MW plant delivers 1,000 MW for only one hour, it has delivered 1,000 MWhrs. But if a 500 MW plant delivers 500 MWs for 20 hours it has delivered 10,000 MWhrs, a much more significant achievement.”

Telephones Reconnected

On Jan. 31, 2004, Bechtel completed restoration of the switching system for 12 destroyed telephone exchanges, enabling the Iraq Telephone and Post Company (ITPC) to begin reconnecting 252,000 subscribers. As of Aug. 12, 2004, ITPC has reconnected approximately 211,000 subscribers.

Sanitation Systems Being Upgraded

U.S. spending for repairing water and sanitation systems throughout Iraq now totals $520 million.

Bechtel’s Pruett said his company is repairing four sewage treatment plants in Baghdad, where the Tigris River has been called “an open sewer,” and four others in other regions of Iraq. Rehab of the largest of these plants is scheduled to be completed by this December.

“Approximately 85 percent of Iraq’s total sewage treatment capacity will be returned to full functionality,” Pruett said in his e-mail reply.

The four Baghdad facilities have a total capacity of 774,623 m3/d. The others are smaller, ranging in capacity from 12,000 m3/d to 41,250 m3/d.

Bechtel also is still refurbishing the city-wide sewage system for Baghdad’s 3.5-million residents. In May 2004, it restarted one-third of one of the city’s major wastewater treatment plants, enabling it to treat sewage for the first time in several years.

Reflecting the continued threat from insurgents, Pruett e-mailed from Baghdad, “We please ask that you again do not use the names of any of the [sewage and water treatment] plants. Noting the city or general region is fine, but please do not use specific names. We ask this as part of our desire to protect the security of our workers.”

Baghdad’s four sewage plants are now scheduled to be completed by the fourth quarter of 2004 or the first quarter of 2005 — redressing a festering morale and health problem.

“Since the early 1990s, Iraqi children died in very high numbers [because of untreated water],” said the Year in Iraq publication. “Much of this is directly attributable to the deliberate neglect of the country’s wastewater facilities and the draining of the southern marshlands. The death rate has been so high — hundreds of thousands over the past 12 years — that in parts of the South it may be tantamount to infanticide.”

Potable Water

Pruett said restoring water and sanitation system to ensure a reliable supply of potable water to the general public and protect public health has made Bechtel’s rehabilitation of these facilities to their original capacities and capabilities an urgent priority. He said the planned rehabilitation “will go beyond restoring the system to pre-2003-conflict conditions.”

Major water projects include:

• Expanding a water treatment plant in Baghdad that will increase the capital’s potable water supply by 250 million liters a day. This $20.6-million expansion is scheduled to be completed by the end of this September.

• Modernizing the water treatment plant in Najaf.

• Bechtel completed the dredging, cleanout and restoration of the Sweet Water Canal reservoirs near Basrah in March 2004, more than doubling the drinking water supply to its 1.6 million residents of Basrah. Thirteen water treatment plants also are being completed in this (Southern) region.

• The restoration of a treated water system to 40,000 residents of Safwan was completed last November.

Pruett said that “18 water-treatment plants, numerous water pump stations, and three distribution systems will be restored to full capacity.”

Fuentes commented, “With water, you’re talking about a lot of things which were a wreck and needed to be rebuilt, especially in those areas around Baghdad, like Sadr City, which Saddam Hussein never gave any attention.”

Fuentes said he had not heard of any attacks on the water and sanitation effort and said many Iraqis support the work.

“People on the ground that I’ve spoken with have a completely different outlook than what is being reported,” he said. “They have more of a positive tone [than is being reported]. Most are very appreciative of the U.S. government, and what we’re trying to do. Democracy is a long, tough, process, but the focus has to remain positive.”

Bridges, Railroads and Airports

Rebuilding bridges damaged during the war has been a high-priority project under prime contractor Bechtel.

Here there’s mostly good news.

• The four-lane Al Mat Bridge on Highway 10, which carries 3,000 trucks a day between Baghdad and Jordan, reopened to two-way traffic on March 3, 2004.

• The south span of the Khazir Bridge, critical to the flow of fuel and agriculture products, reopened for two-way traffic on May 5, 2004. Two of the span’s four lanes are now open.

• The Tikrit Bridge across the Tigris River between Tikrit and Tuz Khurmatu had been listed on the Web page as “expected to finish in May 2004,” but now, Pruett said, “is scheduled to reopen to two-way traffic by the conclusion of the third quarter of 2004.”

• The floating bridge on the Tigris at Al Kut has been repaired. It’s now carrying about 50,000 people a day.

Bechtel has been working on the bridges (as well as roads and railroads) under USAID contracts totaling at least $28 million.

Highways are in relatively good shape. The Iraqi Republic Railways (IRR) system, which includes 2,200 km (1,367 mi.) of track and more than 10,000 rail cars, also is functional. USAID is managing a project for constructing 72 km (44.7 mi.) of new track.

The Baghdad International Airport and Basra International Airport have been rehabbed at a cost of $47 million.


A total of more than $2.5 billion was allocated to USAID for reconstruction projects during the current fiscal year ending Sept. 30. This came out of the $18.4 billion that Congress authorized for reconstruction when it approved an $87.5-billion supplemental aid package for Iraq last fall.

“We’re requesting the same amount [$2.5 billion] for Fiscal 2005,” Fuentes said.

The Iraq reconstruction is directed by retired Adm. David Nash, who heads a newly renamed Projects and Contracting Office.


Full operation of Iraq’s oil industry has been seriously impeded by recent sabotage and attacks.

Before the war, Iraq was producing 2.5 million barrels of oil per day. The U.S. was steadily climbing towards this level before the attacks this summer. Before hostilities, nationalization of Iraq’s oil in 1972 had excluded both the United States and the United Kingdom from this work, although France, Germany, Russia, China, Japan and others won major concessions.

Iraq has the second-largest oil reserves in the world after Saudi Arabia. These reserves are now estimated at between 200 billion and 300 billion barrels of high-grade crude, extraordinarily inexpensive to produce.

Kellogg, Brown & Root Services, a subsidiary of Halliburton Corp., Houston, TX, planned the repair and continuity of the Iraq oil infrastructure under contracts from the Department of Defense beginning in 2001, and has been awarded more than $4.2 billion for this work since then.

The Army Materiel Command said this August that it would withhold 15 percent of future payments to Halliburton, accusing it of inadequate accounting for work in Iraq and Kuwait. Then it announced it would further review the allegations before withholding.

Halliburton, where Vice President Dick Cheney was once chief executive officer, said the penalty, if it goes through, would be mitigated because it plans to withhold 15 percent from its subcontractors under previous agreements with them.


Is there hope in Iraq as attacks continue on contractor personnel as well as Iraqi citizens involved in the rebuild?

“The biggest thing is that these people [insurgents] are former Baathists [members of the Baathist party] supporting Saddam, who do not want to see the light of day of democracy over Iraq,” Fuentes said. “They are going to continue attacks, trying to disrupt the process, until the elections next January. However, the process is there; it’s ongoing, whether they like it or not. Either they will realize it, put their arms down, and join the rest of the Iraqi society in a free and democratic society, or they will end up dead.”

Signs of Progress

Fuentes said new local councils are breathing new hope into citizens, “giving them a taste of what democracy is like.”

“It’s a new process for a lot of people,” he said. “They are enjoying that. It has been bumpy. I don’t think anybody would say everything has been fine, but for the most part the Iraqis are seeing now, a year later, the differences between Saddam’s regime and a free and open society. Citizens, including women, now have a voice.

“Our education initiative is also making a big difference. Saddam has installed an unfortunate brainwashing technique in which he became almost a god. Changing all those textbooks, re-educating all those teachers, and building schools has been a huge undertaking. Things are moving and are now almost up to speed.”

Bechtel also has completed rehabbing more than 1,250 primary and secondary schools last October, 52 health care clinics on March 31, 2004, and 10 fire stations in Baghdad on April 30, 2004. Last December, it also completed the satellite gateway, which can handle all international calls placed from anywhere in Iraq.

USAID has awarded 13 contracts and six grants for its reconstruction work. Its most-recent contract, announced on July 14, 2004, provides $56.4 million over the next 24 months to Creative Associates International, Washington, D.C., to provide technical assistance to the Ministry of Education in creating model schools in each of 81 subdistricts, train primary and secondary school teachers, procure educational supplies and promote community participation in quality early-childhood education.

The Baghdad and Basrah International Airports have been available to receive commercial flights since July 15, 2003. The port of Umm Qasr was reopened to commercial traffic on June 17, 2003.

Will the Employment Program Work?

Since the United States disbanded the Iraqi Army, unemployment has been widespread (30 percent). The reconstruction effort is helping employ people who might otherwise become enemies.

“During the peak of reconstruction activities on the buildings program, Bechtel’s Iraqi subcontractors employed more than 41,000 Iraqis,” Pruett said. “Today Bechtel, through USAID’s Iraq Reconstruction Projects, is employing thousands of Iraqis. We expect this to continue until these projects are completed.”

USAID last year said Iraq reconstruction has created more than 77,000 public works jobs. Some recent press reports, however, put the number of Iraqis hired at 30,000 — way short of the original goal of 250,000 — also estimating that only 2 percent of the $18.4 billion that was authorized has been spent.

Nash said on July 13 that 1,439 of 2,300 projects were under way and that 30,000 to 60,000 Iraqis were working on them on any given days, with the numbers climbing steadily.

The most recent project is constructing a $22 million landfill near Baghdad. Nash said this project, which began in July, is employing 1,900 Iraqis per day. It is directed by FluorAMEC.