The U.S. contractor for one of Israel's key new weapons systems, the Tactical High Energy Laser (THEL) is reportedly abandoning the project because of disagreements with the U.S. Army and Israeli government over who is responsible for paying for cost-overruns. The THEL is being developed by TRW to provide Israel a defensive capability against Katyusha rockets and other short-range artillery threats primarily along its northern border.
According to Inside the Pentagon (May 27, 1999), TRW expects the Army and Israelis to pay for overruns, while the Army wants the company to assume the responsibility. The original $89 million contract, signed in July 1996, called for TRW to design, build, integrate and test the THEL. The contract was modified in January 1998, and another $42.5 million was allotted for field tests of the THEL against Katyushas at the Army's High Energy Laser Test Facility at White Sands Missile Range, New Mexico.
The system has been delayed by a variety of problems that have caused cost-overruns and put the project behind schedule. The hope was to have live-fire testing completed by the end of February 2000 and the first THEL demonstrator delivered to Israel shortly thereafter.
The Pentagon insists the program will continue with or without TRW.