The contracts include options to build four Littoral Combat Ships (LCS), two per company, between 2005 and 2009, assistant secretary of the Navy John Young said.

The ships would be the first of a new generation of fast, combat ships with modular plug and play systems for missions such as minesweeping, anti-submarine warfare, surface warfare and intelligence missions in shallow-water areas like the Gulf.

The requirement laid down by the navy was that the ships have sprint speeds of at least 40 knots, long-range transit distances of over 3,500 miles, and be able to launch and recover manned and unmanned aircraft and seaborne vehicles.

The navy envisions the ships as a platform for prepackaged systems that could be loaded on or off in a day, depending on the mission, be it to track submarines, locate mines or penetrate coastal defenses.

"The real power is that we can bring on mission modules, which are the capabilities ... in terms of sensors, air vehicles that carry sensors. And we're going to be able to continually improve those capabilities and bring them aboard in modules on these seaframes that LCS provides," Young said.

They will use drones for surveillance and be electronically plugged into a broader network of warships.

Lockheed Martin-Maritime Systems and Sensors, of Morristown, New Jersey, was awarded 46.5 million dollars for the final design of its proposed LCS with a semi-planing mono hull that can reach speeds of 45 knots, the navy said.

If the navy exercises its option to build two ships, the contract would be worth 423 million dollars.

General Dynamics' Bath Iron Works won a 78.7 million dollar design contract for an LCS with a trimaran hull.

That contract has a potential value of 536 million dollars if two ships are built.

A proposal by Raytheon was rejected.

Young said the navy may select a single ship from the two designs or it may decide to buy a mix of the ships after the first four.

"We're taking the opportunity to see both designs function," Young said. "The designs have different attributes that is worthwhile for the navy to evaluate."

The navy has budgeted to buy 13 littoral combat ships in 2008, but how many ships the navy ultimately buys beyond that will depend on evolving requirements, he said.

But Young said estimates that the navy will acquire 60 of the ships worth some 12 billion dollars were "in the ballpark."

WAR.WIRE