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UPDATE-2-Key U.S. lawmaker urges split tanker buy

(Adds Abercrombie quotes, White House budget recommendation, background)

WASHINGTON, March 11 (Reuters) - The head of a congressional subcommittee that oversees the U.S. Air Force called on Wednesday for splitting a projected $35 billion aerial tanker purchase between rivals Boeing Co BA.N and Northrop Grumman Corp NOC.N, which is teamed for the competition with Europe's EADS EAD.PA.

Neil Abercrombie, who heads the House of Representatives’ Armed Services Committee’s panel on air and land forces, said he would work to buy both models after two botched attempts to speed the replacement of existing tankers averaging nearly 50 years old.

“I think that a consensus is developing” in Congress on a dual-source approach, the Democrat from Hawaii told reporters after speaking to a defense industry conference. “I think we can come to a reasoned conclusion on getting both bids accepted.”

The Air Force has said the tankers are its top acquisition priority, although the White House has asked the Pentagon to consider delaying the refueling tankers to save money.

Defense officials said on Wednesday no decisions had been made and all programs were under intense scrutiny.

Congress makes the final decisions on budget matters.

John Murtha, chairman of the U.S. House Appropriations subcommittee on defense, similarly has proposed splitting the baby to end a stalemate between rival congressional delegations eyeing jobs that would flow from a winner-take-all deal.

Abercrombie, in remarks to the conference co-hosted by Aviation Week Magazine and McAleese & Associates, said that he and Murtha, a Pennsylvania Democrat, are “pretty much on the same page” on splitting the purchase.

A dual-source strategy has been spurned by Defense Secretary Robert Gates. The Pentagon’s departing top arms buyer, John Young, has maintained that choosing a single supplier would let U.S. taxpayers enjoy the fruits of competition for the contract and avoid two costly logistics chains.

The White House’s Office of Management and Budget gave the Defense Department a list of possible program savings, including a recommendation to delay the new refueling aircraft, but no decisions had been made, said Pentagon Deputy Comptroller Kevin Scheid.

“We take all of OMB’s recommendations seriously, but it was a recommendation,” he told reporters after speaking to the conference on Wednesday.

Pentagon spokesman Geoff Morrell said Gates would make his decisions based on the best interests of national security.

“Every program imaginable is subjected to this very, very harsh scrutiny that is under way right now as part of the budget process,” Morrell told reporters at a briefing. “I wouldn’t distinguish one from another.”

Based on Airbus parent EADS’ supplying a modified A330 airframe, Northrop was awarded a contract in February 2008 for what were to have been an initial 179 tankers valued at $35 billion. Boeing successfully challenged the award.

Gates, President Barack Obama’s sole cabinet holdover from the Bush administration, has said he plans to renew the competition in coming months.

This would be the Air Force’s third attempt at buying new flying fuel stations since 2003, when Boeing offered a $23.5 billion lease-buy deal that ended in scandal.

“I think in this instance you’ve got two good propositions here,” Abercrombie told Reuters before the conference. “They have different possibilities and different capabilities. But why not get both of them then?” (Editing by Maureen Bavdek and Tim Dobbyn)

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