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Saudi Arabia signs deal for 320 PAC-3 missiles - Lockheed

WASHINGTON, Oct 14 (Reuters) - Saudi Arabia signed an agreement last week with the U.S. government for the purchase of 320 more Patriot PAC-3 missiles built by Lockheed Martin Corp , and may accelerate its plans to buy the longer-range THAAD system, a senior Lockheed official told Reuters this week.

The PAC-3 sale is part of a larger possible deal valued at $5.4 billion for a total of 600 PAC-3 missiles that was approved by the U.S. government in July. Such approvals, which do not guarantee a deal will be reached, are followed by negotiations about an actual sale.

Saudi Arabia, a key U.S. ally, is participating in coalition efforts to fight Islamic State militants in Syria, while also battling Iranian-allied Houthi rebels in Yemen, who have already fired Scud missiles against the kingdom. Saudi Arabia also remains concerned about the growing military strength of Iran.

The PAC-3 missile defends against incoming aircraft and missiles, and it is currently used by the United States, the Netherlands, Germany, Japan, Taiwan and the United Arab Emirates, according to Lockheed.

Joe Garland, vice president of business development for Lockheed’s missiles and fire control division, told Reuters this week that Saudi Arabia would likely follow up with a purchase next year of the remaining 280 PAC-3 missiles in the agreement.

He said the Gulf country was also looking to accelerate a likely purchase of the Terminal High Altitude Area Defense anti-ballistic missile system known as THAAD, which is also built by Lockheed, and a deal could be reached in 2017.

Lockheed officials had previously said they were upbeat about the prospects of reaching a THAAD deal, but that it could take three to five years to reach a deal.

The U.S. State Department declined comment.

Garland said evolving threats in the region had prompted Saudi Arabia to “look at the opportunity to accelerate” that purchase.

Riki Ellison, founder of the non-profit Missile Defense Advocacy Alliance, said the urgency of Saudi’s missile defense purchases was driven by Scud missile launches from Yemen and Saudi Arabia’s concerns about Iran.

Separately, the U.S. government said on Wednesday it has approved the possible sale to Saudi Arabia of nine UH-60M Black Hawk helicopters built by Sikorsky Aircraft, a unit of United Technologies Corp, in a deal valued at $495 million. (Reporting by Andrea Shalal; Editing by Frances Kerry)