Naval Base Guam, seen here Aug. 9, 2021, is within the Integrated Air and Missile Defense System under construction on Guam. (Naomi Johnson/U.S. Navy)
The Pentagon approved another $407 million for Lockheed Martin’s work on the Enhanced Integrated Air and Missile Defense System on Guam, bringing the company’s contract total to $1.9 billion, according to a recent announcement.
The contract, first awarded in November 2020, calls for the company to engineer, develop and certify integrated air and missile defense capabilities into the Aegis Ballistic Missile Defense system being built on the island.
The Lockheed contract is part of an $8 billion project to defend the U.S. island territory from cruise, ballistic or hypersonic missiles that could come from China or North Korea in the event of hostilities. The Pentagon announced the extension on May 7.
Guam is the westernmost U.S. territory and a key forward operating base in the Pacific. Andersen Air Force Base, Marine Corps Camp Blaz and Naval Base Guam, which includes the Polaris Point submarine base, are located there.
The defense system is a 360-degree integrated air and missile defense network on 16 sites around the island. Eight sites are on Naval Base Guam, six are at Andersen and two are on Blaz.
The system is composed of 36 missile launchers, 23 communication towers and 14 radar systems. Construction is scheduled for completion in 2035.
The project could have consequences for the island’s environment and living standards, according to an Environmental Impact Statement released in July.
An influx of contractors and service personnel to build and operate the system may strain the island’s housing supply and health care system, according to the report.
Construction is expected to destroy 282 acres of limestone forest and remove nearly 5,500 fadang trees, an endangered species unique to the region, while also threatening the habitat of the endangered Mariana fruit bat, according to the impact statement.
An Aegis system on Guam would give the U.S. its third operational Aegis Ashore installation.
The other two are in Deveselu, Romania, operational since 2016, and Redzikowo, Poland, operational since 2024. Both sites are designed to protect NATO allies and U.S. personnel from potential missile attacks originating in the Middle East.
Both European Aegis systems incorporate radar stations from the SPY-1 family and an integrated fire-control system.
The Guam system was planned to include AN/TPY-6, a ground-based radar derived from SPY-7 and Long Range Discrimination Radar technology. However, the Pentagon halted its development in January 2025 while retaining an experimental panel for potential future use, according to Defense News on May 30, 2025.
Lockheed Martin was the only company considered for the modification. The company faces no competitive bidding pressure on a contract that has grown by more than $400 million.
Sole-source contracts that pay fixed costs and incentive costs, plus fees, are standard practice for the Pentagon. They are used for complex or early-stage development projects where costs cannot be estimated accurately in advance, while incentivizing contractors to meet performance targets, according to the official U.S. government acquisition website.
The work will be performed in Moorestown, N.J., home of Lockheed’s Combat System Engineering Development Site, and on Guam. The modification extends Lockheed Martin’s original contract timeline by two years to December 2029, according to the contract announcement.
