(DESPARDES/PKONWEB) — Boeing has been awarded a contract by the U.S. Navy for standoff land attack missiles to support Saudi Arabia, a major ally for the US in the Middle East region.
The deal, announced Tuesday by the Department of Defense, is valued at more than $64 million under the terms of a cost-plus-incentive-fee contract.
The agreement enables Boeing to “restart” the AGM-84 Standoff Land Attack Missile production line and expand the production process to the benefit of Saudi Arabia, said a Pentagon press release.
Additionally, the contract calls for a redesign of obsolete or nearly obsolete products in order to streamline new advances and future sustainment.
Work on the contract will occur in St. Charles, Missouri and other locations in the United States.
The Pentagon says the contract is expected to be complete in March 2019.
The total amount of the contract will be obligated to Boeing at time of award from foreign military sales funds, which will not expire at the end of the current fiscal year.
Last month, during the 2-week royal visit by Saudi Crown Prince Mohammed bin Salman to the United States, the State Department approved three arms sales worth more than $1 billion to the Saudi kingdom.
The sales include 6,000 Raytheon TOW-2 anti-tank missiles worth $670 million, $106 million in helicopter support and $300 million worth of vehicle parts. “The proposed sale of TOW 2B missiles and technical support will advance Saudi Arabia’s efforts to develop an integrated ground-defense capability,” the State Department said then.
However, the sales are not yet finalized, as all foreign military sales have to be approved by Congress.
The deal is part of the massive arms package, which was initially agreed during the Riyadh summit in May of last year.