February 15, 2012

(Reuters) - NATO is to buy five U.S.-made unmanned drone aircraft capable of countering Afghan insurgents, hunting pirates off Somalia or monitoring arms embargoes, an alliance official said on Wednesday.

The drones are part of the Alliance Ground Surveillance (AGS) project, scheduled to begin operating between 2015 and 2017. The project reflects NATO efforts to cooperate more closely with its member states on defense costs and capabilities at a time of financial constraints.

NATO has said last year's Libya conflict exposed shortcomings in the alliance's surveillance ability.

Thirteen allies - Bulgaria, the Czech Republic, Estonia, Germany, Italy, Latvia, Lithuania, Luxembourg, Norway, Romania, Slovakia, Slovenia and the United States - will participate in the procurement of the unmanned drones and other equipment such as deployable ground stations that will support AGS.

NATO members gave their approval to the project this month, after two decades of wrangling over how to share funding.

"The acquisition itself is plus 1 billion (euros)," a NATO official told reporters, speaking on condition of anonymity.

The cost will include five Global Hawk drones, produced by U.S. firm Northrop Grumman, as well as training and pilot costs, he said. Maintenance of the drones and operation costs will amount to around 2 billion euros over 20 years.

Northrop Grumman ISS International is the main contractor, while the German arm of EADS, Italy's Galileo Avionica - a unit of Finmeccanica - and the Canadian arm of General Dynamics are also involved.

The drones can fly at 60,000 feet and stay aloft for more than 24 hours.

NATO says the uses of the AGS include countering attacks by improvised explosive devices in Afghanistan and piracy off Somalia, as well as humanitarian operations, disaster relief and monitoring arms embargoes.

The system will have its main base at Sigonella in Italy and several associated command-and-control base stations.

Britain and France will contribute surveillance equipment, the official said, instead of a portion of their contribution to the financing of the system's base, infrastructure and communications costs, which will be borne by all NATO states.

(Reporting by Justyna Pawlak; editing by Andrew Roche)

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