Borrowing on Iraq oil collateral to pay US firms.

[k hanly <khanly@xxxxxxxxxxxxxxx>]

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HALLIBURTON AND BECHTEL PUSH TO USE FUTURE IRAQ OIL CASH FOR REBUILDING

Published: May 30 2003 5:00 | Last Updated: May 30 2003 5:00

The US administration is considering a financing mechanism that could
rapidly boost funds for rebuilding Iraq by using the country's future oil
and gas revenues as collateral for loans on new projects. The scheme, being
pushed by a coalition of large companies that includes Halliburton and
Bechtel, could generate $3bn-$4bn (£8bn-£2.4bn) a year at a time when Iraq
will be struggling to generate sufficient revenues from oil and gas sales.
But it could raise questions about whether the Iraqi interim authority,
currently under US government control, should be empowered to lock up the
proceeds of Iraq's future oil sales to support exports from US companies.
Bank chief Philip Merrill told a congressional hearing last week that the
idea has "real merit".