RALEIGH, N.C. — In more fallout from the Sept. 16 shooting in Baghdad that left 11 Iraqis dead, Blackwater USA apparently has stopped its expansion projects.

On Wednesday, the North Carolina private military contractor canceled a $5.5 million deal to buy 1,800 acres of farmland near Fort Bragg, where it was going to set up a training ground for soldiers and corporate executives.

The diplomatic and public relations damage from the shooting, combined with next Tuesday's scheduled testimony before Congress by Blackwater Chairman Erik Prince, prompted the company to put all new projects on hold, according to the president of the company that had agreed to sell the land to Blackwater.

"Blackwater said they had pulled all new projects off the table because of this shooting in Baghdad and because they were preparing Prince for Congress," said Wayne Miller, the president of Southern Produce Distributors. "It's a shame. This would have been good for the economy of North Carolina."

Southern Produce owns a huge tract of farmland and wetlands known as Barra Farm, near the Cape Fear River.

Miller said he was first approached to sell the land by the president of another security company, TigerSwan, which has offices in Cary, N.C., and Breckenridge, Colo. When Miller asked TigerSwan's president, Jim Reese, about financing, Reese confirmed that Blackwater was behind the deal.

Prince inspected the property before agreeing to the price.

The sales contract allowed Blackwater to back out for any reason through Thursday. Miller said Blackwater Chief Executive Officer Gary Jackson had called Wednesday to cancel.

Neither Blackwater nor TigerSwan responded to requests for comment.

(Neff reports for The (Raleigh) News & Observer.)