(Adds details from FEMA statement, company comment)
WASHINGTON, Oct 27 (Reuters) - Federal emergency officials said on Friday they did not approve a multimillion dollar contract between Puerto Rico's power utility and a small Montana firm to repair storm damage, and has "significant concerns" about the deal.
The Federal Emergency Management Administration also said that after its initial review it "has not confirmed whether the contract prices are reasonable" under the agreement between Puerto Rico Electric Power Authority (PREPA) and Whitefish Energy Holdings.
The $300 million contract between PREPA and Whitefish was awarded to the two-year old Montana firm with just two full-time employees without a competitive bidding process, according to media reports.
A spokesman for Whitefish defended the contract and said the company welcomed an audit of its work.
"The contract was done in good faith with PREPA" and "speaks for itself," Whitefish spokesman Ken Luce told MSNBC in an interview, adding later: "There's nothing there."
Puerto Rico's governor has also defended the contract, but U.S. lawmakers have raised concerns and are seeking more information about the deal.
About one million people do not have clean water and millions are without power weeks after Hurricane Maria made landfall.
Forty-nine people have died in Puerto Rico officially, with dozens more missing. The hurricane did extensive damage to the islands power grid, destroying homes, roads and other vital infrastructure. (Reporting by Susan Heavey; Editing by Chizu Nomiyama and Jeffrey Benkoe)