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Friday, January 16, 2004 - Page updated at 12:00 A.M.

Iraq Notebook
Germans win phone contract

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BERLIN — Siemens AG said yesterday it will develop a cellular-phone network in Iraq — the first reconstruction contract publicly announced by a firm in Germany, which vehemently opposed the U.S.-led war.

Siemens' U.S. affiliate, Siemens-Westinghouse, is working to win a contract to supply two power stations with parts in conjunction with the U.S. engineering giant Bechtel, company spokesman Peter Gottal said.

The U.S. last month excluded firms from countries that opposed the war from bidding on reconstruction projects, but they are not barred from subcontractor work. This week, the Bush administration said it was reconsidering and might allow companies from anti-war countries to bid as primary contractors.

German firms built much of modern Iraq, including the Baghdad-Istanbul railway, the central bank, Baghdad's main power station and university and many of the country's dams, bridges and roads. Business ties began to decline after the start of the eight-year Iran-Iraq war in 1980.

Radioactive material found in steel reportedly from Iraq

AMSTERDAM, Netherlands — A recycling company found uranium oxide — a radioactive material also known as yellowcake — in a shipment of scrap steel it believes originally came from Iraq, the company said yesterday.

Paul de Bruin, spokesman for Rotterdam-based Jewometaal, said the shipment was passed on last month from a Jordan metal dealer who was unaware it contained any forbidden materials.

"I've dealt with this man for 15 years, and he says he's sure it came from Iraq," De Bruin said.

Nuclear experts say that although not highly radioactive, uranium oxide can be processed into enriched uranium usable in a nuclear weapon — but experts said about 2 pounds of yellowcake, the amount found, would not be useful for either a bomb or fuel.

Dr. Alan Ketering, a researcher at the nuclear research plant at the University of Missouri, Columbia, said yellowcake contains less than 1 percent of U-235 used in nuclear weapons. He said it would need to be refined many times with sophisticated technology before it was dangerous — and the amount found in Rotterdam would not be nearly enough.

President Bush came under heavy criticism last year when he asserted in his State of the Union address that Iraq was shopping in Africa for uranium yellowcake — intelligence that turned out to be based on forged documents.

Probe sought on fuel deal by Halliburton subsidiary

WASHINGTON — Pentagon auditors have asked the Defense Department inspector general to investigate a deal between a Halliburton subsidiary and a Kuwaiti company to import fuel into Iraq after finding "evidence of potential unlawful activity," a Defense Department official said yesterday.

The Defense Contract Audit Agency had been reviewing how much the subsidiary, KBR, charged for the fuel under a contract with the U.S. Army Corps of Engineers. A draft audit report by the agency last month concluded that KBR may have overcharged $61 million by importing more costly fuel from Kuwait instead of from Turkey.

Pentagon Comptroller Dov Zakheim said KBR had done nothing improper and blamed the potential overcharge on an antiquated accounting system.

The referral Monday to the IG signals that the auditors now believe they have evidence of wrongdoing by either KBR or the Army corps, which directed KBR to buy the fuel from Kuwait.

Also ...

Army Spc. Lori A. Piestewa, a member of the Hopi tribe who was the first American servicewoman killed in Iraq, will be honored at the Sept. 21 opening of the National Museum of the American Indian. Piestewa, from Tuba City, Ariz., was traveling with Pfc. Jessica Lynch in a convoy that was ambushed by Iraqis on March 23. ... The killing of two journalists in a Baghdad hotel by a U.S. tank shell on April 8 was the result of "criminal negligence," Paris-based watchdog group Reporters Without Borders said in a special report. The group said it was not a deliberate attack on the media, but U.S. soldiers should have been told by their commanders that many journalists were based in the hotel.

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