Blackwater's still in Iraq, despite lack of license

WASHINGTON — Armed guards from the security firm once known as Blackwater Worldwide are still protecting U.S. diplomats in Iraq, even though the company has no license to operate there and has been told by the State Department its contracts will not be renewed two years after a lethal firefight that stirred outrage in Baghdad.

Private security guards employed by the company, now known as Xe, are slated to continue ground operations in parts of Iraq long into the summer, far longer than had previously been acknowledged, government officials told The Associated Press.

In addition, helicopters working for Xe's aviation wing, Presidential Airways, will provide air security for U.S. diplomatic convoys into September, almost two years after the Iraqi government first said it wanted the firm out.

The Washington Times first reported that Blackwater, or Xe, signed a $22.2 million deal in February with the State Department to keep the company working there through most of the summer.

The company's continued presence raises fresh questions about the strength of Iraq's sovereignty even as the Obama administration urges the budding government to take more responsibility for the nation's future.

Iraqis had long complained about incidents caused by Blackwater's operations. Then a shooting by Blackwater guards in Baghdad's Nisoor Square in September 2007 left 17 civilians dead, further strained relations between Baghdad and Washington and led U.S. prosecutors to bring charges against the Blackwater contractors involved.

That deadly incident was the end, Iraqi leaders said. Blackwater had to get out.

But State Department officials acknowledge the company is still there.

The company declined to comment about a timetable for leaving. "We follow the direction of our U.S. government client," Xe spokeswoman Anne Tyrrell said. Last February, Blackwater changed its name to Xe — pronounced ZEE — in a bid to leave its controversial reputation behind.

Defense analyst Loren Thompson of the Lexington Institute in Arlington, Va., said Iraq's ability to enforce bans on companies like Blackwater may provide an early measurement of the strength of its internal sovereignty. As the Iraqi leaders gain more control, he said, the final exit for Blackwater will be inevitable.

"But let's face it, they're not entirely their own masters yet," he said.