CRITICS of the Iraq war seized on revelations yesterday that a Texas company with close links to the White House has been given the authority to run the country’s oilfields.

Halliburton, which was headed by Dick Cheney, the Vice-President, for five years until 2000, was handed a much larger role in post-war Iraq than previously believed. Its emergency contract, which it won from the US Government without having to bid against any rivals, was initially described as for fighting fires at Iraq’s oil wells. But it emerged yesterday that the firm has also been charged with operating pumps and distributing oil, a much more direct, lucrative and politically sensitive role.

Democrats called for all facts about the contract to be disclosed, threatening deep embarrassment for the White House on one of the most sensitive aspects of the war and its aftermath. Large parts of the Muslim world viewed the war as a battle for Iraq’s oil, a view shared around Europe but strenuously denied by Britain and the US.

Henry Waxman, a Democrat congressman from California, raised the details of Halliburton’s contract after receiving a letter from the US Army Corps of Engineers, which awarded the contract. The Corps wrote to Mr Waxman saying the contract included extinguishing fires and the “operation of facilities and distribution of products”.

Mr Waxman stopped short of accusing the Corps of deliberately misleading anyone when the original contract was announced, but he said: “I am concerned that the Administration’s reluctance to provide complete information about this and other Iraqi contracts has denied Congress and the public important information.”

He said that the revelations were at odds with Mr Bush’s assertion that Iraq’s oil belonged to the Iraqi people. “Only now, over five weeks after the contract was first disclosed, are members of Congress and the public learning that Halliburton may be asked to pump and distribute Iraqi oil under the contract.”

The deal, awarded to Kellog Brown and Root (KBR), a Halliburton subsiduary, was among the early contracts given by Washington to US companies to kickstart the reconstruction of Iraq. Nine contracts handed out by the US aid agency were open to bids, but only from US firms. The oil contract was given to KBR without a bidding process.

The contract could be worth up to $7 billion (£4.4 billion) for up to two years, although the Corps has emphasised that the figure is based on a worst-case scenario of oil-well fires. Few fires were burning during the war and since early March KBR had received $76.7 million, according to the Corps.

Mr Waxman also disclosed that Halliburton had done business in Iran, Iraq and Libya for years, despite US embargoes. The dealings “appear to have continued during the period 1995 and 2000, when Vice-President Cheney headed the company”, Mr Waxman wrote in a letter to Donald Rumsfeld, the Defence Secretary.

The link with Mr Cheney heightens the potential embarrassment for the White House. Mr Cheney revealed yesterday that Mr Bush had asked him to be his running-mate in the 2004 presidential election. Mr Bush had previously said he would ask Mr Cheney, and the Vice-President said that his family and doctors had given him the go-ahead.

Mr Cheney, who has had four heart attacks, said: “Everything is fine. If I ran into problems where I felt I couldn’t serve, I’d be the first to say so and step down.”

US officials distanced the White House from the oil contract. Ari Fleischer, Mr Bush’s spokesman, said that it was “not a White House issue”, and questioned Mr Waxman’s motives. “He never met a Republican he didn’t want to investigate.”

Jennifer Millerwise, a spokeswoman for Mr Cheney, who served as Halliburton chief executive from 1995 to 2000, said: “He has nothing at all to do with awarding the contracts, the bidding process or the current work orders.”

Mr Waxman said the dealings with Iran, Iraq and Libya went back to the 1980s and appeared to have continued during the time that Mr Cheney was heading the company. He said that there was evidence “that indicates that Halliburton has profited from numerous business dealings with state sponsors of terrorism, including two of the three members of President Bush’s axis of evil”.

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