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Libya Mission Cost at $550 Million for U.S. Forces So Far

The U.S. cost of the Libya mission has reached $550 million, mostly for bombs and missiles including Raytheon Co. (RTN) Tomahawk cruise missiles, and may total $800 million by the end of September if the U.S. continues operations until then, according to the Defense Department.

The rate of spending will drop quickly as NATO takes over the mission, which began March 19. The next three weeks, until April 16, will cost an estimated $40 million, according to Pentagon “talking points” provided to the U.S. Congress.

The decline reflects what the Pentagon projects will be a “sharp” drop in the use of U.S. fighter jets, aerial tanker refueling and intelligence, surveillance and reconnaissance flights.

If the operation continues at the reduced level after April 16, the Pentagon expects a monthly cost of about $40 million, according to an e-mail statement by Navy Commander Kathleen Kesler, a Pentagon spokeswoman.

The document provided to Congress estimates the total cost of $800 million if the operation lasts through the end of fiscal 2011 on Sept. 30. The caveat that the Pentagon offered Congress is that “future costs are highly uncertain.”

The Defense Department is funding the Libya operations by using money “designated for other national security purposes” and drawing from its munitions inventory, according to the document provided to Congress.

Source: U.S. Navy

Of the approximate $550 million cost of the first 10 days of operations, the Pentagon said about $340 million would be for munitions, mostly Tomahawk missiles. Close

Of the approximate $550 million cost of the first 10 days of operations, the Pentagon... Read More

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Source: U.S. Navy

Of the approximate $550 million cost of the first 10 days of operations, the Pentagon said about $340 million would be for munitions, mostly Tomahawk missiles.

The Pentagon is being funded through a stopgap measure at fiscal 2010 levels. Congress has yet to approve a Pentagon spending bill for fiscal 2011, which started last Oct. 1.

No Supplemental Request

President Barack Obama isn’t expected “at this time” to request supplemental funding to cover the costs of the Libya operation, according to the Pentagon document.

Out of the approximately $550 million cost for the first 10 days of the operations -- March 19 through March 28 -- the Pentagon said about $340 million was for munitions, mostly Raytheon Tomahawk missiles, which cost $1.5 million apiece.

The U.S. launched 192 Tomahawks in the first 10 days, for a cost of about $288 million, according to Bloomberg calculations. The remainder of the $550 million, or $210 million, covers operating costs for primarily aircraft and partly for ships, according to the talking points.

The U.S. has more than 4,000 personnel involved in the Libya mission and is using about 175 aircraft. The U.S. aircraft include the Lockheed Martin Corp. (LMT) F-16CJ fighters, Boeing Co. (BA)’s AV-8B Harrier aircraft, EA-18G Growler electronic-jamming jets and KC-135 refueling tankers, as well as Lockheed Martin’s and Boeing’s AC-130U close-air-support plane.

One Boeing F-15E crashed over Libya on March 22. One of those planes costs $79.2 million. The Pentagon in the document provided to Congress said a similar fighter jet can no longer be purchased. The loss of the jet wasn’t counted in the cost estimate.

-- Editors: Steven Komarow, Bob Drummond

To contact the reporter on this story: Roxana Tiron in Washington at rtiron@bloomberg.net.

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net.

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