Pentagon chief: No decision yet on new tanker bids

WASHINGTON, June 26 (Reuters) - U.S. Defense Secretary Robert Gates said on Thursday he has not yet decided whether to reopen the competition for a $35 billion Air Force refueling tanker program.

Last week, federal auditors faulted the Air Force's selection process which resulted in Northrop Grumman Corp (NOC.N) and its European subcontractor, EADS (EAD.PA), winning the lucrative deal over rival Boeing Co (BA.N).

The Government Accountability Office said the Air Force made "significant errors" and urged the Air Force to rerun the bidding competition.

"I haven't made any decisions yet, but I would say that I take the GAO report very seriously," Gates told reporters. "They clearly pointed out some areas where we were deficient."

At stake is a deal for 179 aircraft over 15 years valued at $35 billion, the first of three projected acquisition phases for what the Air Force calls its No. 1 purchase priority. (Reporting by Jim Wolf and Julie Vorman; Editing by Tim Dobbyn)