The Missile Defense Agency (MDA) awarded Lockheed Martin [LMT] a $2.46 billion modification on Monday to produce Terminal High Altitude Area Defense (THAAD) interceptors for the U.S. and Saudi Arabia, raising the total contract value to nearly $4 billion.

This award will procure THAAD interceptors and associated one-shot devices under fixed-price incentive contract line items and increase the total contract from $1.4 billion to $3.9 billion.

A Terminal High Altitude Area Defense (THAAD) battery fires an interceptor missile. (Photo: Lockheed Martin)

The announcement did not disclose specific numbers of interceptors or devices in the sale.

The work will be performed in Dallas, Texas; Sunnyvale, Calif.; Huntsville, Ala.; Camden, Ark.; and Troy, Ala., and is expected to be finished by April 2026.

U.S. procurement funds of $923 million and Saudi Arabia Foreign Military Sales (FMS) funds of $1.5 billion were obligated at award time.

In March, MDA awarded Lockheed Martin a $946 million contract for the first part of a THAAD sale to Saudi Arabia under a $15 billion FMS of THAAD (Defense Daily, March 5).

In 2017 the State Department approved the sale of the THAAD system to Saudi Arabia. The country’s original request covered 44 launchers, 360 interceptor missiles, 16 fire control and communications mobile tactical station groups, and seven Raytheon [RTN] AN/TPY-2 radars (Defense Daily, Oct. 6, 2017).

The American sale of THAAD is part of the larger $110 billion defense sale announced in May 2017 (Defense Daily, May 19, 2017).