* Sept. 23 incident under investigation
* Problems appears unique to engine in question
* Other engines still running (Adds details about GE-Rolls engine incident, background)
By Andrea Shalal-Esa
WASHINGTON, Sept 28 (Reuters) - General Electric Co (GE.N) and Britain's Rolls Royce Group PLC (RR.L) said on Tuesday that one of the F136 engines they are developing for the F-35 Joint Strike Fighter was damaged during testing on Sept. 23.
News of the incident comes as lawmakers debate whether to ignore the threat of a White House veto and continue funding the GE-Rolls engine in the fiscal 2011 year beginning Oct. 1.
The companies said in a joint statement that the problem occurred about three hours into a mechanical "check out" development engine #008 was running at near maximum fan speed, damaging some airfoils in the front fan and compressor area.
The engine was being disassembled to determine the cause, but all indications were that the problem was unique to this particular engine, the companies said, noting that other engines were continuing to run.
The companies said they were also researching the manufacturing and assembly records for the engine.
GE spokesman Rick Kennedy said the GE-Rolls team had tested five F136 development engines for more than 1,000 hours since early 2009 without experiencing this problem. He said an investigation was under way.
There have been other problems and damage during testing of the GE-Rolls engine and one being developed by Pratt & Whitney, a United Technologies Corp (UTX.N) unit for the Lockheed Martin Corp (LMT.N) F-35 fighter.
Industry executives have said testing is designed to gain data about engine performance and to fine-tune production and assembly processes.
Neither two other development engines now running in the testing program nor earlier development engines have had the same problem as engine #008, Kennedy said.
He said the next development engine was already in assembly and should begin testing within a few months, which would bring the number of engines in testing to six in 2010.
He said the program, which is moving toward a first flight in 2011, had reached several milestones this year, including achieving significant thrust margins at sea-level test conditions and operating at temperatures below specification.
Last week, White House spokesman Robert Gibbs said President Barack Obama was committed to ending funding this year for the second F-35 engine, but congressional backers have repeatedly rejected administration efforts to cancel the GE-Rolls engine.
Backers of a second engine argue that competition will save money in the long run.
The Government Accountability Office said in a report earlier this month that it would cost less than $2.9 billion estimated by the Pentagon to finish its development.
GE has said the team needs about $1.8 billion to finish development and that continued competition could save $20 billion in the long term from a market estimated at around $100 billion. (Reporting by Andrea Shalal-Esa)