UPDATE ON RAYTHEON PAYMENT FOR BIAP RADAR

UNCLAS BAGHDAD 003824 SIPDIS E.O.: N/A TAGS: EAIR ECON ETRD PGOV PREL IZ SUBJECT: UPDATE ON RAYTHEON PAYMENT FOR BIAP RADAR ¶1. (U) Raytheon Corporation has a contract to install and commission a radar system at Baghdad International Airport. The original contract amount was $27.5 million and was a cost-plus contract. The Ministry of Transportation (MoT) currently owes Raytheon $15.2 million -- $9.4 million for work completed and $5.8 million in overages. Payment of this amount would close out all contract payments. ¶2. (U) MoT has agreed to pay the $9.4 million to Raytheon by letter of credit (L/C). To cover the $5.8 million of overages, IRMO Transportation and Joint Contracting Command-Iraq assisted Raytheon and MoT in creating a solution by which MoT would authorize $2.9 million in seized funds, IRMO would obligate $1.9 million in IRRF funding, and Raytheon would contribute the remaining $1.0 million. ¶3. (U) After repeatedly engaging Deputy Prime Minister Chalabi and the MoT on the status of the payments, on September 14 Post received confirmation from the Senior Advisor to the Minister of Transportation that the Contracts Committee approved the use of $2.9 million in seized funds to pay the overage charges and also approved the $9.4 million L/C. ¶4. (U) Raytheon continues to work at Baghdad International Airport. Satterfield