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Just before the war in Iraq started, the U.S. Army Corps of Engineers awarded Halliburton a contract for emergency postwar repairs without competitive bids. That contract was intended to cover initial oil fires, damage assessments and other needs.

Though it was authorized for as much as $7 billion to cover a worst-case scenario, the corps now estimates it will total about $600 million.

The new, permanent contract will be open for competitive bidding among the U.S. and foreign companies. The Defense Department is reviewing the work involved, said corps spokesman Scott Saunders.

Anticipating the contract would be needed, Fluor began preparing for the bid as soon as the war began last month. "It's absolutely right up our alley," said Fluor Chairman and Chief Executive Alan Boeckmann. He noted that Fluor, Aliso Viejo, Calif., is already working next door in Kuwait, rebuilding a fire- damaged refinery and an oil-processing plant.

Closely held Bechtel, San Francisco, which led the $1.5 billion reconstruction of Kuwait's oil fields after the first Gulf War, also would be interested, said spokesman Mike Kidder.

Halliburton, Houston, won the first contract without competitive bidding because of urgent time constraints, the corps said.