The U.S. Air Force has modified contracts to see through completion of two more satellites being built by Lockheed Martin, the aviation and aerospace manufacturer said.

The $200.7 million cost-plus-incentive-fee modification builds on and modifies an existing contract for the two Global Positioning System III space vehicles, 05 and 06, part of a multibillion-dollar U.S. Air Force program to replace aging satellites with more powerful craft.

The contractor is the U.S. Air Force Space and Missile Systems Center Contracting Directorate, Los Angeles Air Force Base, Calif.

GPS satellites now in orbit are aging and users are demanding more capability, Lockheed Martin says. The program for modernizing the military system dates back to 2008 when the U.S. Air Force gave

Lockheed Martin a contract for the design, development and production of the GPS III Non-Flight Satellite Testbed and the first two of up to a dozen GPS III satellites.

U.S. Air Force demands for greater capacity have responded to U.S. roles in peacekeeping and conflict operations in different parts of the world.

GPS III aims to improve position, navigation and timing services and provide advanced anti-jam capabilities yielding superior system security, accuracy and reliability.

The first GPS III satellites will deliver signals three times more accurate than current GPS spacecraft and provide three times more power for military users, Lockheed Martin says. The program will also enhance the spacecraft's design life and add a new civil signal, which aims to be interoperable with international global navigation satellite systems.

Work on the satellites will be done at Littleton. Colo., and Clifton, N.J., and is expected to be completed by Dec. 14, 2017 for satellite 05 and June 14 and by 2018 for space vehicle 06.

In February, the USAF awarded Lockheed Martin a fixed-price $120 million contract to procure long-lead parts for a second set of four GPS III satellites. This new award provides funding to complete the first two satellites -- SV05 and SV06 -- in this order. Full production funding for the next two satellites -- SV07 and SV08 -- is expected in 2014.

Lockheed Martin is under contract to produce the first four GPS III satellites. Of those, SV01 to SV04, the first two are in production at Lockheed Martin's GPS III Processing Facility in Denver.

The GPS III team is led by the Global Positioning Systems Directorate at the U.S. Air Force Space and Missile Systems Center. Lockheed Martin is the GPS III prime contractor with teammates Exelis, General Dynamics, Infinity Systems Engineering, Honeywell, ATK and other subcontractors.

USAF Space Command's 2nd Space Operations Squadron at Schriever Air Force Base, Colo., manages and operates the GPS constellation for both civil and military users.