State Department chooses not to renew Blackwater contract

WASHINGTON — The State Department said Friday it will not renew Blackwater Worldwide's contract to protect American diplomats in Iraq when it expires in May.

"The department notified Blackwater in writing on Jan. 29 that it did not plan to renew the company's existing task orders for protective security detail in Iraq," said Joanne Moore, a State Department spokeswoman.

She said the contract will lapse because of the Iraqi government's decision to deny Blackwater a license to operate. The Iraqis informed the State Department last week of the denial, which was made amid lingering outrage over a September 2007 shooting in Baghdad's Nisoor Square that left 17 Iraqi civilians dead.

"All foreign and domestic security companies in Iraq require operating licenses. The U.S. government expects its contractors to comply with Iraqi laws and regulations," Moore said.

A senior department official said that renewing Blackwater's contract was "basically a moot point because they were not going to be allowed to operate in Iraq anyway." The official spoke on condition of anonymity because the decision has yet to be announced.

The State Department says it is still considering how to protect U.S. diplomats in the wake of the Iraqi denial of Blackwater's operating license.

Officials have said one possibility would be to replace Blackwater with one or a combination of guards from two other U.S.-based security contractors that work for the State Department in Iraq, DynCorp and Triple Canopy. Both have had licenses to operate in Iraq, but it's not clear if they are current or have been renewed.

Blackwater spokeswoman Anne Tyrrell declined to comment on the status of the contract, saying the company understood the State Department "is exploring its options."

"We are awaiting direction from our customer," she said. She stressed that Blackwater had always known that its services in Iraq would be temporary.

Blackwater executives say the company could leave Iraq within 72 hours of being told to do so, but they cautioned that such a move would cause more harm to the diplomats it protects than to the company itself.

Blackwater has been operating in Iraq without a formal license since 2006. The State Department extended Blackwater's contract for a year last spring, despite widespread calls for it to be expelled because of the shootings.