Peter La Franchi/CANBERRA
The Royal New Zealand Air Force's Project Sirius upgrade of six Lockheed P-3K Orion maritime patrol aircraft has been terminated as part of the Government's sweeping overhaul of defence priorities.
The decision leaves the future of the RNZAF's maritime patrol capabilities in limbo, pending the outcome of a follow-on review of New Zealand's economic zone and South Pacific surveillance requirements. The decision is the second blow to the RNZAF's procurement plans. Earlier this year, a planned lease of 24 Lockheed Martin F-16A/Bs, intended to update the air force's strike force, was cancelled.
According to New Zealand defence minister Mark Burton, the Sirius decision was based on the costs of Raytheon Systems' preferred bid rising to NZ$550 million ($248 million) because of exchange rate movements. The Raytheon bid had a 25 August expiry date, but could have been extended had the Ministry for Defence requested it.
Burton says the review will be carried out by a team of cabinet ministers. The review will "examine how the wide range of non-military requirements for maritime patrol can most appropriately be met, and whether a military maritime patrol capability should be maintained."
The review, which excludes consideration of future air combat capability, is to report next February. Meanwhile, the RNZAF will continue Orion operations.
Sirius included the installation of a new airborne data management system, magnetic anomaly detector, acoustic data processor system, navigation system, and radar and electronic support measures as well as the introduction of an electro-optic sensor.
The termination raises fundamental questions about the long-term business outlook for Raytheon in the Australia and New Zealand defence/aerospace market. Raytheon was selected for Sirius in October last year.
It is already prime contractor for the Royal Australian Air Force's AP-3C Sea Sentinel upgrade, now running more than two years late. The company had hoped to link the New Zealand and RAAF projects through life support contracts, and the development of a software and mission system support facility in Adelaide. This strategy was dealt a blow in June when the RAAF awarded its first support contract to RLM Systems, effectively ruling out long-term Raytheon involvement in AP-3C mission system enhancements.
The outcome of a second avionics support competition has been delayed until later this year, with Raytheon bidding against BAE Systems Australia.
The New Zealand Government cuts package also includes a decision to close the RNZAF's Hobsonville base and the relocation of 3 Squadron, equipped with Bell UH-1H Iroquois helicopters, to Ohakea, north of Wellington. Air training operations will shift from Ohakea to Woodbourne on the South Island.
Source: Flight International
