U.S. extends Blackwater task in Iraq

BAGHDAD, Sept. 3 (UPI) -- The U.S. State Department says a controversial U.S. private security company claimed to have been enlisted in a CIA hunt for al-Qaida members will continue its armed presence and task of shielding U.S. diplomats in Iraq.

Formerly known as Blackwater, Xe Services will retain an aviation service -- mainly helicopter escorting of U.S. officials because the company hired to replace it was not yet ready to take over, the Trade Arabia Web site reported Wednesday.

The contract, ending Sept. 3, was the company's last remaining deal with the U.S. State Department after revelations in June that the CIA enlisted Blackwater for an unknown role in a secret program designed to take out high-value members of al-Qaida.

"We have arranged for a temporary extension of the contract," State Department spokesman Ian Kelly told reporters, Trade Arabia reported. It said the decision was taken after the new company, DynCorp, was in need of additional time to prepare for its assignment because of a shortage in equipment.

The spokesman did not elaborate.

Xe's continued presence in Iraq was bound to spark criticism.

When the Blackwater hit squad plan was reveal by The New York Times, congressional leaders lashed out against the CIA and for not informing them.

In addition, the agency's director, Leon Panetta, pulled the plug on the program, maintaining that no hit missions had been launched and that no militants had either been located or captured.

About 1,000 Blackwater staff members were used to guard U.S. government personnel in Iraq following the 2003 U.S.-led invasion, making it among the largest security companies operating in this country.

In 2004 the company drew scrutiny when four of its employees were killed by an angry mob in Fallujah, then a stronghold for Sunni Arab insurgents.

The bodies were mutilated, fanning a monthlong assault on Fallujah that left 36 U.S. soldiers, 200 insurgents and 600 civilians dead.

Three years later the company's guards opened fire in the middle of Baghdad, killing 17 civilians. The incident uncorked public outrage with the government in Iraq scrapping Blackwater's operating license earlier this year.

Bent on shedding its tarnished reputation, the North Carolina-based company renamed its operations it to Xe Services.

Last month a report in The Nation said the U.S. administration extended the company's contract on July 31, increasing its payment by $20 million and bringing the total paid by the State Department to Xe's aviation services in Iraq to $187 million.