UPDATE 2-Pentagon eyes new anti-missile technology

* Boost-phase efforts being dropped

* Pentagon eyes new "ascent phase" technology

* Funding up for Aegis, THAAD programs (Recasts with information from Pentagon briefing)

By Jim Wolf

WASHINGTON, May 7 (Reuters) - The Pentagon is redirecting its missile defense efforts by winding down multibillion-dollar programs aimed at destroying enemy missiles very soon after they take off.

The move away from "boost-phase" intercept programs was announced as part of President Barack Obama's fiscal 2010 budget request sent to Congress on Thursday.

The Pentagon's Missile Defense Agency said it had turned bullish in recent months on prospects for intercepts during the ascent phase, which it termed "significantly less challenging."

The ascent phase starts after powered flight, but before a ballistic missile deploys decoys or executes maneuvers to avoid being shot down in the post-boost phase of its flight.

"We believe technologies now available -- not previously available -- make this a more suitable, more affordable enterprise," said retired Navy Rear Admiral David Altwegg, the agency's executive director.

"Our studies tell us that this ascent-phase interceptor effort will provide the margin of superiority needed and replace boost-phase as we now know it," he told reporters.

Altwegg said the Missile Defense Agency had several initiatives under way that could lead to deployment of such systems as soon as 2013 or 2014, if funded by Congress. Altwegg declined to name any of the potential contractors.

CANCELLATIONS

The Obama administration said on Thursday it would cancel the Kinetic Energy Interceptor, a boost-phase program being developed by Northrop Grumman Corp (NOC.N: Quote, Profile, Research). The cancellation was one of the few surprises in a spending plan that was largely laid out by Defense Secretary Robert Gates last month.

Once valued at as much as $6 billion, the KEI was targeted for cancellation after running into cost and technical hitches, including overheating and repeated first and second stage booster failures, the missile agency said.

Randy Belote, a Northrop Grumman spokesman, said the company was disappointed the administration had chosen not to fund the KEI program. He said it offered "the strategic flexibility we believe is absolutely essential to deal with constantly evolving ballistic missile threats."

Gates had previously announced plans to turn another boost-phase program, a modified Boeing Co (BA.N: Quote, Profile, Research) 747 equipped with a chemical laser, into a research effort rather than one aimed at potential production models.

The Airborne Laser, designed to destroy all classes of ballistic missiles in their boost phases, is scheduled to try to shoot down a dummy target in September.

"I would not yet dismiss ABL," Altwegg told reporters. The residual research program could lead to other "speed-of-light" missions, including destroying enemy aircraft and surface-to-air missiles, advocates of the system have said.

Overall, Obama sought $7.8 billion for the Missile Defense Agency, a cut of about $1.2 billion from last year. Also terminated was Lockheed Martin Corp's (LMT.N: Quote, Profile, Research) Multiple Kill Vehicle program.

The spending reduction was slightly smaller than the $1.4 billion cut announced by Gates on April 6, when he rolled out plans to tie U.S. military spending more closely to conflicts such as Iraq and Afghanistan.

In another development, Altwegg said it had been agreed to let federal research labs compete to carry out a $5 million study of a possible space-based missile defense, a potential baby step toward a system once mocked as "star wars."

The Pentagon has spent more than $100 billion to date to develop anti-missile systems based at land, sea, and in the air.

The 2010 budget maintains funds that could start building a missile interceptor field in Poland and a related radar station in the Czech Republic if the political decision is made to go ahead. Strongly opposed by Russia, the European sites would be used to help defend against any missile attack from Iran.

Budget documents showed funding for the Aegis ballistic missile defense system built by Lockheed Martin Corp (LMT.N: Quote, Profile, Research) would increase to $1.86 billion in fiscal 2010, up from $1.17 billion in fiscal 2009.

Funding for the Terminal High Altitude Area Defense (THAAD) system, also built by Lockheed, would rise to $1.12 billion in the fiscal year beginning Oct. 1 from $882 million last year. (Additional reporting by David Morgan and Andrea Shalal-Esa; Editing by Tim Dobbyn)