Pentagon Adds $10 Million to Raytheon's $1 Billion Spy Ship Project

On Monday, the Department of Defense announced it has awarded Raytheon (NYSE: RTN  ) a $9.8 million cost-plus-fixed-fee modification to a contract first awarded in December of 2003 -- for $1 billion.

That original contract assigned to Raytheon's Integrated Defense Systems business the COBRA JUDY replacement mission, or CJR, in which the company was asked to "design, develop, and acquire a functional replacement mission equipment suite for the current COBRA JUDY."

COBRA JUDY is the code name for the AN/SPQ-11 passive electronically scanned array (PESA) radar systems used to track objects in space -- in particular, ballistic missiles flying through space. It is currently installed on the USNS Observation Island, a naval vessel that circles the globe, monitoring nations' compliance with strategic arms limitations treaties, and also supporting U.S. military weapons test programs.

At 44 years old, however, the Observation Island is said to have become "unsustainable." First scheduled for retirement in 2012, it is in dire need of replacement, and Raytheon's assignment as prime contractor is to both manage the development of an improved radar suite, and integrate it onto a new merchant-class hull (the USNS Howard O. Lorenzen). The company is working on this project with Northrop Grumman (NYSE: NOC  ) , which responsible for preparing an S-band phased array radar system to pair with Raytheon's X-band radar.

The current contract modification funds "an alternative architecture study in support of" CJR.


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