PASCAGOULA, Miss., June 24, 2004 (PRIMEZONE) -- Ushering in another key milestone for the Integrated Deepwater System program, the U.S. Coast Guard and Integrated Coast Guard Systems (ICGS) today announced that preliminary design and final requirements work will commence immediately on the new Offshore Patrol Cutter (OPC) program. This effort will lead to a new type of highly capable, cutting-edge, medium-endurance cutter. Today's action accelerates the effort to launch the OPC by a full three years, compared to the Deepwater program's originally proposed schedule. This initial OPC contract assigned to ICGS establishes the critical first-step engineering efforts that will occur over the next twelve months.

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Northrop Grumman's (NYSE: NOC) Ship Systems sector has the lead on the OPC design effort with some of the contract going to their joint venture partner, Lockheed Martin, for co-development of engineering design and system integration. Each partner has been awarded a subcontract to begin the effort, the full share of which will be determined as a result of technical scoping and level of effort determination.

"Northrop Grumman Ship Systems is proud to be a part of this challenging fleet modernization program, along with our capable partners on the Integrated Coast Guard Systems team," said Dr. Philip A. Dur, president of Northrop Grumman Ship Systems. "We are ready now to accelerate the design and production of this critical component of the Deepwater fleet. Northrop Grumman Ship Systems is committed to delivering both capability and durability to our customer, and we are anxious to get underway."

The notional design of the OPC anticipates a 341-foot vessel with capabilities and equipment similar to the Coast Guard's new National Security Cutter, a 421-foot world-class cutter that is completing final design and is soon to commence construction.

The final mission requirements and detail design of the OPC will be refined as a result of this contract, with additional funding available for follow-on contracts. With this accelerated contract, it is now expected that the first cutters could enter the Coast Guard fleet several years ahead of the original schedule date in 2012.

Integrated Deepwater Systems is a critical multiyear, multibillion dollar program to modernize and replace the Coast Guard's aging ships and aircraft, and improve command and control and logistics systems. It is the largest recapitalization effort in the history of the Coast Guard. When complete, the interoperable Integrated Deepwater Systems system will include three classes of new cutters and their associated small boats, a new fixed-wing manned aircraft fleet, a combination of new and upgraded helicopters, and both cutter-based and land-based unmanned aerial vehicles.

Northrop Grumman Ship Systems includes primary operations in Pascagoula and Gulfport, Miss.; and in New Orleans and Tallulah, La., as well as in a network of fleet support offices in the U.S. and Japan. Ship Systems is one of the nation's leading full-service systems companies for the design, engineering, construction and life-cycle support of major surface ships for the U.S. Navy, U.S. Coast Guard and international navies, and for commercial vessels of all types.

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Bill Glenn
Northrop Grumman Ship Systems 
(228) 935-1323