Bechtel’s partner in charge of Iraq.
The U.S. Government, through its Agency for International Development (USAID), let a contract for Iraq work shortly the U. S. troops moved into Baghdad in April 2003. This was Iraq Infrastructure I, originally funded for $680 million and subsequently increased to $1 billion. Bechtel National, Inc., won that competitive contract. Within months USAID solicited bids for Iraq Infrastructure II, which was to be for up to $1.8 billion and likely would extend through December 2005. Bechtel National won that competitive bid also.
The man now in charge of these two contracts, Cliff Mumm, has worked for Bechtel for 29 years but may not have faced a bigger and more scrutinized challenge than he does this year.
“This is a tremendous amount of, work in the time allotted,” says Mumm from his Baghdad office. Mumm is a Bechtel partner and is accustomed to managing huge projects under tremendous deadlines compounded with public scrutiny and political controversy. Notably, this includes the Jubilee Line for the London subway, which crossed the Thames River four times and had to be completed in time for the Millennium Celebration but was behind schedule when Mumm took it over. So political was this work that Mumm often had to meet with British Prime Minister Tony Blair. Bechtel got the job done on time, and Mumm was awarded Honorary Commander of the Most Excellent Order of the British Empire (CBE).
Mumm’s digs are considerably different today. Bechtel works in a country traumatized by war, plagued by terrorist attacks and burdened with an infrastructure that was in tatters even before the bombs began to fall. Not the least of the challenges is dealing with expectations - both those of the U.S. media and of the Iraqi people - for a swift and complete reconstruction of the country. That far overstates Bechtel’s charge, whose original assessment of Iraq’s infrastructure estimated such work would require perhaps $20 billion and at least a decade.
Mumm was trained in chemical engineering at the South Dakota School of Mines and Technology. He has worked around the world at just about every type of engineering and construction job there is (though not telecommunications, he points out, something he is wrestling with in Iraq). He’s had oversight for major projects such as Reliance Industry ’s Jamnagar (India) petrochemical complex, Kazakhstan’s Tengiz oil field petroleum processing facility, and Saudi Arabia’s Shoaiba Saline Water Conversion Corporation project. He has worked on railroads, power plants and much more. He was in charge of Bechtel worldwide construction when he was asked to take on the Iraqi contract.
The Bechtel team set to work in April and arrived in Iraq in mid May. They set up camps in major areas, the largest now being at Baghdad and Basrah. Of immediate priority was opening Umm Qasr, the country ’s only deepwater port. The main job here was dredging, although the work also included the reconstruction of grain silos. This project took most of the summer and fall, but under Bechtel’s guidance the efforts allowed deepwater grain ships to enter. Hundreds of thousands of tons of grain and humanitarian aid have now passed into Iraq through Umm Qasr.
Bechtel also renovated more than 1,200 schools throughout the country with the goal of completing at least 1,000 of them in time for the October 1 start of the school year. The schools program employed over 30,000 Iraqi workers. The work included cleaning, painting, plumbing and replacing the likes of windows, fans and doors that had been broken or looted. Ultimately, over 1,100 of 1,239 renovated schools were ready by October 1; one million Iraqi children entered and resumed their studies.
THE USAID CONTRACT
Bechtel’s USAID contract also covers roads and bridges, water and wastewater treatment plants, airports and power plants. It includes rebuilding the Al Mat Bridge bypass on Highway 10, a 4-lane critical route between Baghdad and Amman, Jordan. Already by the end of last year Bechtel completed work on the Safwan water supply system near Basrah, delivering clean water to 40,000 residents. The project is doing the same kind of water and wastewater work in Baghdad and places a cross the country. It has installed communications systems and power supply to the nation’s two major airports, opening them again to limited commercial service. It is helping upgrade the nation’s railroads and it is repairing telecommunications hubs. Besides all this, Mumm says, the company is overseeing efforts for training and development to improve the engineering, construction and project management skills of the nation’s professional workforce.
Bechtel’s goal has been to award 70 percent of subcontracting to Iraqis and so far it has been meeting this goal. “The Iraqi engineers are good and they are hungry for knowledge,” says Mumm. “They are computer literate, but as was the case in Eastern Europe under the communists, here they were working with outdated and failing equipment. Owing to Saddam and the sanctions imposed on the country, Iraqi engineers spent much of their efforts merely keeping things patched together. They were deprived of modern equipment and techniques.” As to subcontracting 70 per- cent to Iraqis, Mumm says that this was not only a method of getting the work done, but also “the right thing to do.”
Mumm reports that most of the damage to the infrastructure of the country was not a result of the war. “The Coalition armed forces said they were taking out targets surgically, and by and large that is what they did. They would bomb, say, a telecommunications station but the houses around it were not damaged.” More of the trouble with the infrastructure owes to Saddam’s policies and the depredations of living for so long in near isolation from the rest of the world. “Saddam, for example, did not use wastewater treatment plants to clean water; rather he stored diesel fuel in them,” Mumm says. All the sewerage in Iraq before the war was dumped into the country’s rivers.
“Transporting anything here is still a problem,” Mumm confesses. “It’s hard to get a transporter, and just as difficult if not more so to obtain insurance for the transportation.”
Another challenge was the subcontracting. Under Saddam, each government ministry had its own construction arm. But Bechtel had to work with private contractors, of which there were few. “We’ve had to stand up the whole system here,” Mumm reports. “We organized conferences, streamlined qualifications, got companies qualified and more. The Iraqis did not have operating capital nor a system for workman’s compensation. Bechtel put up its own operating capital for subcontractors and assembled an insurance package. We are very proud of that.”
THE ELECTRICAL POWER PROBLEM
The electrical power problem has gotten special attention by the media. “The power system was a disaster,” says Mumm. “Under Saddam, there was no regular maintenance as we know it. Engineers were told to keep the plants operating but with little or no resources. They were threatened with jail or worse if they could not keep them running, but the equipment was decrepit.” And it was not really so much power. The pre-war output was an operating 4,400 MW out of a nominal capacity of 10,000 MW. Saudi Arabia with a similar population produces 14,000 MW. Moreover, Saddam was sucking power from around the country to supply Baghdad. Doing so allowed Baghdad about 22 hours of power a day while Basrah was allowed only two to four hours of power a day. After the war, transmission lines and towers were looted for their metal or toppled in the countryside by angry locals who wanted to make sure power was no longer exported from their regions to keep the lights on in Baghdad.
Bechtel played a large role as a member of the power action team - formed last summer by the Coalitional Provisional Authority - that included the U.S. Army Corps of Engineers and the Iraqi Ministry of Electricity. The team tripled electrical output from 1,275 MW in April to pre - war levels. This is not noticed so much in Baghdad, which received far more than its fair share before the war, as in outer lying areas. Basrah for example now has 22 hours of power a day, rather than the pre-war two to four.
Power in Iraq is mainly fueled by diesel, natural gas and crude oil; crude is preferred. Bechtel’s work is rehabilitation. Building new power plants is going to have to wait. Over the long run, “only about 2,000 MW here is salvageable,” Mumm says. “Eventually we’ll have to add 2,000 MW to retain the pre-war level. But then, just to get up to Saudi levels, at what we call ‘the Gulf Standard,’ the nation is going to need about another 12,000 MW. In pre-war Iraq only four percent of the population had telephones, one of the lowest standards in the world. Billions of dollars are going to be needed, and it is all going to take a good deal of time. We think we can produce about 6,000 MW nationwide by this summer, with Bechtel helping to accomplish that goal by adding about 900 MW of new and rebuilt generation. That’s about all anyone could do with the existing plants. After that will have to be new ones. The country will need about eight new power plants; it’s going to be expensive and it’ll take four years at least.”
Bechtel has had more than 60 years experience in the Middle East. It worked in Kuwait after the Gulf War of 1991, extinguishing 650 oil fires and managing environmental cleanup. Bechtel has also had extensive experience working with USAID, not only in the Middle East but also in Africa. Bechtel’s efforts under the recently awarded phase II contract are in conjunction with Parsons of Pasadena, CA, and Horne Engineering Services of Fairfax, VA. Mumm says that Parsons will be doing a good portion of the water work and Horne the procurement.
“But I believe there is going to be an economic boom here,” he says. “The demand curve is going to be way out in front of the supply curve for years. With a bit of increasing prosperity, the Iraqis are going to want to buy more refrigerators. That is going to spark demand for more power. As the lights go on, crime will come down. More people will open businesses, again fueling the demand for more power. Oil refineries are going to demand electrical power. Advances will build upon themselves over and over. It’s very interesting to see how water treatment, petroleum and power are all interconnected, each causing demand for the others. I believe that investors are going to gain confidence in the country and capital will come in.”
Mumm’s optimism mirrors that of younger Iraqis. Although, as in Eastern Europe, “a generation of engineers was deprived of up-to-date training and experience,” he says, “those in their 20s and 30s are eager and they have lots to be optimistic about.” Mumm reflects that confidence. He has a huge job in harsh circumstances, but he has no doubt that Bechtel will get it done.