UPDATE 1-Lockheed says committed to South Korea F-35 offset offer

Fri Nov 22, 2013 4:30am EST

By Andrea Shalal-Esa

DUBAI Nov 22 (Reuters) - Lockheed Martin Corp on Friday welcomed South Korea's plans to buy 40 F-35 fighter jets and said it still aimed to build a military communications satellite for Seoul and provide other technology transfers, despite a cut in the number of jets to be ordered.

"We remain committed to our offset projects and I am confident we can put together an agreement with the Korean authorities that preserves the existing projects," said Randy Howard, who headed Lockheed's South Korea F-35 campaign.

Howard said Lockheed was fully committed to working with Korean industry on its KF-X project to design a new fighter aircraft, just as it did on the T-50 trainer developed as part of an offset package for an earlier F-16 purchase.

"We put a bunch of projects on the table and we're not backing away," Howard told Reuters in a telephone interview. "I'm confident we can find a way to preserve the projects that have been offered."

South Korea's military chiefs on Friday decided to buy 40 F-35 stealth fighter jets settling a drawn-out process to beef up the country's defences.

Lockheed spokesman Eric Schnaible said the company would continue to work closely with the U.S. government to meet Korea's Air Force requirements.

"Lockheed Martin is committed to meeting Korea's offset requirements including support and technology transfer for KF-X," he said.

He said the F-35's conventional takeoff and landing model, configured with the final 3F software package that gives the jet its full combat capability, was available to meet Korea's requirement for initial deliveries of the planes in 2018.

Sources familiar with Lockheed's offset package said the company would have to sit down with Korean officials to work out details as part of finalising a fighter deal.

South Korea initially planned to buy 60 fighter jets in the competition, but on Friday said it would initially buy 40 of the stealthy F-35 fighters, which are designed to be nearly invisible to enemy radar, and then open a competition for 20 more planes to other bidders.

Lockheed's offset package includes a program to build, launch and place in orbit a new military communications satellite that will be fully owned and operated by the South Korean government, as well as all necessary control equipment and technical training, said the sources, who were not authorised to speak publicly.

To help Korea develop its new KF-X fighter, Lockheed said it would provide hundreds of man hours of engineering expertise for the KF-X fighter program, as well as hundreds of thousands of pages of technical documentation from its F-16, F-35 and F-22 fighter programs.

The company also offered to build a virtual cyber warfare center to help South Korea develop its cyber training, tactics and procedures.

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