Lockheed eyes additional missile sales in Gulf

Reuters ^ | Jan 8, 2008 | Andrea Shalal-Esa

[sukhoi-30mki]

Lockheed eyes additional missile sales in Gulf

Tue Jan 8, 2008 2:30pm EST

By Andrea Shalal-Esa

WASHINGTON, Jan 8 (Reuters) - Lockheed Martin Corp (LMT.N: Quote, Profile, Research) has provided technical details to Saudi Arabia and Qatar about advanced systems to shoot down enemy ballistic missiles, hoping to add to missile sales already planned to the United Arab Emirates and Kuwait, company officials said on Tuesday.

The Bush administration last month announced plans for sales of Lockheed's Patriot PAC-3 missiles to the United Arab Emirates and Kuwait with a potential combined value of nearly $10.4 billion. The sales are part of a U.S. drive to bolster Gulf Arab states and provide a counterweight to Iran's growing might.

The prime contractors would be Lockheed, maker of the PAC-3 missile segment, and Raytheon Co (RTN.N: Quote, Profile, Research), prime integrator for the overall Patriot system.

The ground-based PAC-3 missiles are designed to intercept incoming ballistic missiles or other enemy targets by slamming into them, a technology known as "hit-to-kill."

Lockheed, the Pentagon's No. 1 defense contractor, said it is in preliminary talks with the UAE and expects that sale to be finalized later this year.

In addition to discussions with Saudi Arabia and Qatar, Lockheed is also talking with Israel about a possible PAC-3 sale or other upgrades to its missile defense systems, company officials told reporters during a teleconference.

The U.S. government's drive to sell other arms to Saudi Arabia has raised concerns among Israel's backers in Congress.

David Kier, Lockheed vice president of program management, said already announced sales to the UAE and Kuwait could lay the groundwork for more. "Hopefully, it will induce some regional sales to other Gulf Cooperation Council members," he said.

Lockheed has won contracts totaling $556 million for PAC-3 missiles over the past year. International sales have accounted for a "nice percentage" of that total, officials said.

So far, Lockheed has sold PAC-3 missiles to three countries that already had the predecessor PAC-2 systems -- Japan, the Netherlands and Germany.

Lockheed systems could help the Gulf states create a regional integrated missile defense, the company said.

"The interest level has been raised significantly over the past year," said Dennis Cavin, head of international development. The timetable for signing new contracts depends on the U.S. government, which takes the lead on country-to-country arms sales, he said.

"It's clear to everyone in the region that ... this is the most lethal technology developed today and everyone is interested," Cavin said.

Possible sales of the PAC-3 system to Saudi Arabia could run into resistance in Congress, where Israel's backers are already concerned about an administration plan to sell Saudi Arabia highly accurate Boeing Co (BA.N: Quote, Profile, Research) bomb-guidance kits.

The Bush administration could formally notify lawmakers as soon as Jan. 15 of the possible sale to Riyadh of Joint Direct Attack Munitions technology. More than half the members of the 435-seat House of Representatives have signed bipartisan warnings to President George W. Bush about such a sale.

Lockheed said it has also responded to a request by the Pentagon's Missile Defense Agency about how to enhance the interceptors, radars and controls of the larger ground-based missile defense system, as part of a process that could open some of that business to competition.

No. 2 Pentagon contractor Boeing has been the prime contractor for that ground-based system for the past 10 years, Northrop Grumman Corp (NOC.N: Quote, Profile, Research), the Pentagon's third-largest contractor, and Raytheon have also said that they planned to respond to the request for information.

(Reporting by Andrea Shalal-Esa, editing by Gerald E. McCormick)

[bert]

Unlike lend lease where we supplied allies with weapons after the war began, this time we are selling them the arms before the shooting war begins.

When it does, all the Gulf States, Iraq, Jordan and Israel will take part in putting down Iran.

Although there are press releases about peace, the reason for the President’s visit is war.