UPDATE 1-US Air Force closely guards tanker winner news
(Adds details on timing, EADS concerns)
WASHINGTON, Feb 26 (Reuters) - In a city where few secrets survive thanks to lobbyists, lawmakers and career bureaucrats, the U.S. Air Force has so far managed to keep under wraps its decision in a high-stakes aerial tanker competition.
Only a select few know whether top acquisition officials picked Boeing Co (BA.N) or a team led by Northrop Grumman Corp (NOC.N) and its European partner, Airbus parent EADS (EAD.PA), to build 179 new refueling aircraft. The deal is valued at $30 billion to $40 billion over the next 10 to 15 years.
Most analysts expect Boeing to win the contract, but Northrop insists it still has a fighting chance.
Air Force officials had hoped to announce the news as early as Monday after a key Pentagon meeting, but two defense officials said an announcement was unlikely before Wednesday, and might not come until Friday.
The news was expected to begin leaking out after Monday's meeting of the Pentagon's Defense Acquisition Board (DAB). However, chief arms buyer John Young has not yet signed a memorandum approving the acquisition program, a critical step before the Air Force can announce the coveted contract award.
In fact, only a small number of those who attended that meeting were even briefed on the Air Force selection, said one source familiar with the program, who asked not to be named.
Lt. Col. Jennifer Cassidy, an Air Force spokeswoman, declined comment on how many officials know which company won, but said the service was at pains to prevent a news leak.
"We're very conscious of the stakes, so we're keeping this as 'close hold' as we can so as not to jeopardize the process," she said, noting that Young must approve a formal kick-off of the tanker program before the Air Force unveils the winner.
On whatever day Young does sign a formal acquisition decision memorandum, the Air Force plans to begin briefing key lawmakers, the companies, and finally the media, but only after U.S. financial markets close at 4 p.m. (2100 GMT), the officials said.
"Given the history, Mr. Young wants to be incredibly careful with this program. He does not want anyone saying that he did something wrong," said one defense official, who asked not to be named.
PROCUREMENT SCANDAL
Congress killed an earlier $23.5 billion Air Force plan to lease 100 Boeing 767 tankers amid a procurement scandal that sent two former Boeing officials to prison on conflict-of-interest charges and prompted the resignation of two senior Air Force officials.
Air Force officials have sought to keep the current competition as transparent and scandal-free as possible, meeting repeatedly with the rival bidders to explain the strengths and weaknesses of their respective proposals.
But defense officials still expect the losing side to protest the award, given its sheer size and a spate of recent decisions faulting the Air Force on other arms programs. Continued...
