Halliburton faces probe by US regulators

Houston - US regulators had formalised an investigation of whether a joint venture including Halliburton, the world's biggest oilfield contractor, violated anti-bribery legislation to win orders for work on a Nigerian gas plant, the company said at the weekend.

The Securities and Exchange Commission (SEC) and the justice department had asked Halliburton for information related to joint venture TSKJ, the company said.

Regulators, who previously requested a report from the company related to allegations against TSKJ, gain the power to subpoena individuals and documents by making an investigation formal.

The SEC probe centres on whether the venture, 25 percent owned by Halliburton, made $180 million (R1.16 billion) in illegal payments.

Halliburton, headed by US vice-president Dick Cheney from 1995 to 2000, already faced investigations concerning its accounting, Iraq contracts and business in Iran.

Alexandra Wrage, the president of Transparent Agents and Contracting Entities, a Washington group that has introduced standards for preventing bribery by companies doing business overseas, said that the company "will forever be associated with reputational problems in Iraq and Nigeria".

She added: "Companies have not only to be clean, but [be] perceived as clean by the public."

Investigators are trying to establish whether TSKJ violated the US Foreign Corrupt Practices Act while it was seeking orders to help build and expand a Nigerian plant that liquefies natural gas.

The act prohibits US companies and foreign companies with US stock listings from paying bribes for contracts.

Halliburton said in a January 23 public filing that the SEC and justice department were reviewing allegations of illegal payments by TSKJ.

Officials asked the company for a report on the matter, and Halliburton hired counsel to investigate, the company said in the filing.

The company said on Friday it was co-operating with the SEC and a French magistrate conducting a separate investigation.

Michael Urban, an analyst at Deutsche Bank Securities in New York, said: "This is certainly not something they needed. It's another piece of noise out there, and the more noise there is, the more it hurts the stock."

A Halliburton spokesperson Wendy Hall said that the company had never authorised any improper accounts or transfers and that it had not seen any documentation of such transactions.

"It is important to our company that our clients, suppliers and host countries know Halliburton's code of business conduct is expected to be followed in every country in which we operate," she said.