The Qatari and British governments have signed an agreement for the potential sale of 24 Eurofighter Typhoon combat jets worth several billion dollars in another move by Doha to bolster its military amid a spat with four of its Arab neighbors.
The deal is also a boost for plane maker BAE Systems PLC, which is seeking to keep Typhoon fighter plane production humming.
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British Defense Minister Michael Fallon signed an agreement with his Qatari counterpart for the planes on Sunday. Mr. Fallon said this was the first major defense contract with Qatar and took years to arrange.
The deal for military planes from the U.K. comes amid a monthslong regional diplomatic spat between Qatar and a Saudi Arabia-led bloc, in which Doha has sought to cement its international ties and burnish its military credentials. Some of the moves, however, have added to the strain.
Qatar, which has been among the biggest buyers of military hardware in the Middle East, said the deal would bolster its ability to fight terrorism.
The tiny but gas-rich Gulf state earlier this year signed a deal to buy 72 F-15 combat aircraft from Boeing Co. in a deal valued at $12 billion. The Middle East country a year ago agreed to buy France's Rafale combat jet, made by Dassault Aviation.
Saudi Arabia, the United Arab Emirates, Bahrain and Egypt broke off diplomatic relations with Qatar in June, accusing their neighbor of supporting terrorism and meddling in their internal affairs, charges Doha denies. The diplomatic standoff in the Gulf pits several U.S. partners against one another.
Doha is home to a U.S. military base that holds 10,000 troops, which the country's emir, Tamim bin Hamad Al Thani, visited on September 11. There is also a sizable Turkish military presence in Qatar.
Diplomatic efforts, including a bid by U.S. President Donald Trump to end the crisis, have so far failed to break the stalemate between Qatar and the Saudi-led bloc.
The U.K. has remained on the sidelines of the regional spat. Prime Minister Theresa May early on in the crisis urged all sides to defuse tension and to preserve unity in the Gulf.
For BAE Systems, the deal comes at an important time. Officials said this year that the company may have to cease production of the Eurofighter Typhoon combat jets in 2019 absent additional export orders. BAE, Europe's largest arms maker by sales, builds the plane in conjunction with Airbus SE and Leonardo SpA.
Even if the Qatar deal is concluded quickly, final assembly may be idled temporarily because of the time it takes to purchase some parts that can have a two-year order lead time. The value of the potential deal, which likely would include training and support, wasn't disclosed.
BAE Systems said Sunday it welcomed the announcement but wouldn't comment further amid ongoing talks.
The Middle East has been one of the rare bright spots for exports of the Typhoon, which has struggled to win orders in other regions. Saudi Arabia has acquired 48 of the planes and may take more. Oman and Kuwait also are customers for the twin-engine combat plane.
Regional tension with Iran and the fight against Islamic State have kept an appetite among Middle East countries for the newest defense equipment despite the sharp drop in oil prices since the middle of 2014. Saudi Arabia in May announced $110 billion in arms deals with the U.S., though several of those agreements had been previously disclosed.
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(END) Dow Jones Newswires
September 17, 2017 13:26 ET (17:26 GMT)