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Defense News Roundup: Pentagon Trains for WMD, and Are Helicopters Heading to Africa?

The U.S. military has a reputation as a somewhat secretive organization. But in one respect at least, the Pentagon is one of the most "open" of our government agencies. Every day of the week, rain or shine, the Department of Defense tells U.S. taxpayers what contracts it's issued, to whom, and for how much -- all right out in the open on its website.

So what has the Pentagon been up to this week?

DoD is budgeted to spend about $6.2 billion a week on military hardware, infrastructure projects, and supplies in fiscal 2014. (A further $5.6 billion a week goes to pay the salaries and benefits of U.S. servicemen and servicewomen.) However, for the third week in a row, Pentagon spending ran considerably under budget last week, at just $2.09 billion in contracts awarded.

And what did the generals get for their (read, "our") money?

Cleaner air for Ospreys
A week of weak defense spending produced few contracts of real size -- and even contractors that won sizable contracts sometimes had to share. Take Textron (NYSE: TXT  ) and Boeing (NYSE: BA  ) , for example. On Tuesday, the two firms, which jointly produce the tiltrotor V-22 "Osprey" aircraft for the military, were awarded a contract to improve engine inlet particulate filtration (i.e., keeping dust out of the engine) aboard Navy CV-22 Ospreys.

In one of the week's biggest contracts, Textron Bell and Boeing will perform engineering work on U.S. Air Force CV-22 Ospreys. Photo: Wikimedia Commons.

Valued at $70 million, the four-year contract should generate about $35 million in new revenues for each of Textron and Boeing.

A slightly better aircraft carrier
On Thursday, Huntington Ingalls (NYSE: HII  ) , builder of the United States' nuclear aircraft carrier fleet, was awarded $14 million to perform unspecified maintenance work on the U.S. Navy's nuclear aircraft carrier USS Ronald Reagan (CVN 76).

WMD training
A bigger contract win went to Cubic Corp. Wednesday, when the U.S. Defense Threat Reduction Agency hired Cubic to assist with chemical, biological, radiological, nuclear, and high-yield explosive exercises for its J3/7 department, the DTRA unit responsible for operations, readiness, and exercises. This contract could ultimately be worth up to $500 million for Cubic over the next 10 years.

News flash: There's still a war on
And finally, for those of you who thought the war in Afghanistan was all but over -- you might want to think again, because the Pentagon is still investing in upgrades for its armored vehicles to fight it. On Friday, Navistar won a $28 million contract modification funding upgrades to its MaxxPro Dash and long-wheel base ambulances for use in the Afghan war.

Opportunities on the horizon
So much for the contracts that everyone knows about. Now, let's end this week's round-up with one contract that you may not yet have heard of.

On Thursday, the U.S. Defense Security Cooperation Agency, which coordinates sales of military services and hardware to foreign governments through the Pentagon, notified Congress of the planned sale of one dozen UH-60M Black Hawk helicopters to the government of Tunisia. Equipped with T700-GE-701D Engines -- 24 to power the helicopters themselves, plus six spares -- and armed to the teeth with 7.62mm and .50 caliber machine guns to Hydra rockets to Hellfire missiles, these 12 helicopters are expected to be bring approximately $700 million in incremental revenue to principal contractors United Technologies (NYSE: UTX  ) and General Electric (NYSE: GE  ) .

Mind you, this contract is not "official" yet, and the Pentagon hasn't yet announced its award. In all probability, most investors don't even know that it's in the works -- except that now, you do.

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Rich Smith

As a defense writer for The Motley Fool, I focus on defense and aerospace stocks. My job? Every day of the week, I'm monitoring the news, figuring out the winners and losers, and tracking down the promising companies for you to invest in. Follow me on Twitter or Facebook for the most important developments in defense & aerospace, and other great stories.

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