KBR, Fluor, DynCorp vie for up to $150 bln Army deals

(Updates throughout, adds background)

WASHINGTON, April 17 (Reuters) - The U.S. Army chose KBR Inc (KBR.N: Quote, Profile, Research), Fluor Corp (FLR.N: Quote, Profile, Research) and DynCorp International Inc (DCP.N: Quote, Profile, Research) on Thursday to compete to provide housing, laundry and other support services to the U.S. military worth up to $150 billion over 10 years.

The three will bid for up to $5 billion per year each in logistics work for the wars now under way in Iraq and Afghanistan as well as other U.S. operations, Army officials said in a conference call with reporters.

A total of five companies had submitted offers for the Logistics Civil Augmentation Program (LOGCAP) IV contract. The Army did not name the two that were eliminated.

The LOGCAP IV "performance contracts" were originally awarded to the same three companies on June 27, 2007. A pair of unsuccessful bidders then filed protests with the Government Accountability Office.

The GAO upheld the protests on Oct. 5, and the Army said it had carried out "corrective actions" recommended by the GAO to clear the way for the fresh announcement of winners.

The protesting bidders were Contingency Management Group LLC, a team composed of AECOM Government Services, Shaw Group and PAE Government Services; and IAP Worldwide Services Inc., a Cape Canaveral, Florida, contractor.

"The selection process was painstaking and thorough," said James Loehrl, executive director of acquisition for the U.S. Army Sustainment Command, referring to the new competition involving revised bids. He said he did not expect a renewed challenge to the Army's choice.

KBR, a former unit of Halliburton Co (HAL.N: Quote, Profile, Research), is the Pentagon's largest private contractor in Iraq, where it has been paid more than $22 billion to provide logistics, meals, laundry and other services to U.S. troops.