WASHINGTON - Democratic lawmakers pressed Defense Secretary Donald Rumsfeld on Friday for records that could shed light on a draft audit that found Halliburton may have overcharged the U.S. government by $61 million for fuel it shipped into Iraq.

Halliburton, the Texas-based oil services company run by Dick Cheney before he became vice president, refused to be drawn into what it suggested was a growing political fight as Democrats put pressure on the Bush administration over Iraqi contracts.

A Kellogg, Brown and Root sign adorns the Halliburton corporate headquarters near downtown Houston, December 12, 2003.  Last week the Pentagon said a draft audit found Halliburton subsidiary Kellogg Brown and Root may have been overcharged $61 million by a Kuwaiti sub-contractor it chose to bring fuel into Iraq from Kuwait. (Tim Johnson/Reuters)

"We do not intend to debate these issues within the context of a political campaign, for either party," said Halliburton spokeswoman Wendy Hall.

A preliminary Pentagon audit disclosed last week found evidence that a Halliburton unit, Kellogg Brown and Root, potentially overcharged by as much as $61 million through September for gasoline imported from Kuwait under an Iraq reconstruction project.

Rep. Henry Waxman of California and Rep. John Dingell of Michigan, respectively the top Democrats on the House of Representatives' Government Reform Committee and the Energy and Commerce Committee, asked for detailed information about subcontracts and bids by potential subcontractors.

They also sought records, by no later than Jan. 5, of contacts between the Defense Department and Halliburton, and between the Defense Department and the Kuwaiti Oil Ministry relating to gasoline imports.

INTERNAL AUDIT DOCUMENTS

Halliburton was awarded a no-bid contract in March to rebuild Iraq's oil industry. So far, it has billed the U.S. government $2.26 billion for related services.

Halliburton denies any wrongdoing and Hall said "KBR delivered fuel to Iraq at the best value, the best price and the best terms."

Hall denied a suggestion by Sen. Joseph Lieberman of Connecticut, a Democratic presidential contender, the company had refused to turn over internal audit documents sought by the Defense Contract Audit Agency, or DCAA.

A Dec. 10 letter in which the audit agency complained about a purported lack of cooperation amounted to "old, outdated information," Hall said in an e-mailed reply to Reuters.

"We are with the DCAA and we have updated and provided materials to them following these numerous meetings" since the Dec. 10 letter, she wrote.

Lieberman, in a letter to Rumsfeld on Thursday, quoted Michael Thibault, DCAA deputy director, as saying Halliburton's own auditors had warned the company of "serious problems" with its fuel contracts with the U.S. government.

"The Halliburton auditors warned that the prices the company was charging to import fuel from Kuwait were excessive," Lieberman wrote.

Hall said all documents used for Halliburton's internal "evaluation" had been provided to DCAA.

A Pentagon spokeswoman said DCAA auditors were reviewing Halliburton's response to their draft audit.

© 2003 Reuters Ltd

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