Dublin Opinion

Politics can be one hell of a flying circus. Ulick McEvaddy, businessman and recent appointee to the Board of Knock Airport, has confirmed that he will discuss letting the US military use Knock Airport at its next board meeting in March. The issue is already the subject of great controversy with regard to Shannon Airport, but Mr. McEvaddy said that he sees no reason why US military planes should not land at Knock.

It appears to be a simple case of economics – one worth millions to the airport and Mayo in general - but Mr. McEvaddy is not only one of the most recent appointees to the board of Knock Airport, he is also joint head of a company that plans to be the largest supplier of civilian aircraft to the US Navy. Mr. McEvaddy also has strong links to Fine Gael, as well as to Charlie McCreevy and Mary Harney (some background can be found in this Sunday Business Post article)

Mr. McEvaddy, in a July 2006 interview with Dow Jones Newswires also made it clear that he sees a civilian role in War. ‘Nations don’t go to war without the public anyway’ he told Rebecca Christie of Dow Jones Newswires (see below). ‘If you look at the historic scenarios – Vietnam, Korea – there were as many civilians in theater as there were soldiers.’

Mr. McEvaddy’s military business interests have not been picked up by the Irish mainstream media. As such, we reproduce below the Dow Jones Newswire article that discusses Omega Air, and its plans to be the biggest supplier of civilian aircraft to the American military. But first, a small part to highlight what I believe to be the greatest conflict of interest between Omega Airs business plans, and the future military use of Knock airport.

In June 2006, McEvaddy’s company, Omega Air, made an unsolicited bid to supply the US Air Force with sixty DC-10s that have been modified as in-flight refuel tankers. The idea was to convince the air force of the economics of the deal by going ahead and acting as if “its terms will be too good for the Pentagon to refuse.” McEvaddy’s said in the summer of 2006, ‘We’re building on risk. If they [the US air force] like it, we think they’ll use it.” The Irish Independent (Reg needed) recently reported that “together with his brother Desmond, Mr. McEvaddy has spent the last 22 years building up his US aviation business, Omega Air.

The experience has earned Mr. McEvaddy invaluable contacts in the US, contacts which he now hopes to use to lure American airlines to his home turf.” No mention was made in the Indo’s article of Mr. McEvaddy unsolicited attempts to create a business deal with the US air force.

Below is the full article by Rebecca Christie of Dow Jones Newswire.
Irish Investor Hopes To Make Big Mark On US Tanker Market

By Rebecca Christie
Of DOW JONES NEWSWIRES
July 13, 2006

WASHINGTON (Dow Jones)–A pair of well-heeled Irish investors are taking on
big defense companies in the race to sell flying gas stations to the U.S. Air
Force.

Irish investor Ulick McEvaddy has little U.S. name recognition, but he is one
of the richest men in Ireland and a well-known developer there. He and his
brother Des are active in Irish politics - sometimes controversial - and were
recently involved in efforts to build a new terminal at Dublin International
Airport.

The brothers also own Omega Air. Officially based in the U.S., the company
owns a fleet of cargo, passenger and military aircraft, including a Boeing Co.
(BA) 707 tanker on lease to the U.S. Navy. Last month, they announced plans to
make a bigger play for U.S. business with a pledge of up to 60 modified DC-10s.

Ulick McEvaddy says he doesn’t see Omega in direct competition with Boeing Co.
and Northrop Grumman Corp. (NOC), which want to sell the Air Force new planes.
Instead, Omega wants to offer fuel by the gallon as an “interim solution,” and
free up military-owned aircraft for other missions.

Air Force officials have been skeptical that civilian-owned aircraft can fit
in with a combat force. But Omega already has bought 20 DC-10s for the project,
in a gamble that its terms will be too good for the Pentagon to refuse.

“We’re building it on risk. If they like it, we think they’ll use it,”
McEvaddy said during a recent visit to Washington.

Omega’s business model is to buy, own and operate its tankers, and it aims to
sell the Air Force tanking services for at least a decade. The planes would be
dedicated to the Pentagon, avoiding the complications of part-time use, and
Omega plans to hire ex-Air Force pilots and crew.

Air Force Concerns

However, senior Air Force officials say they have yet to see how the planes
would save money. Air Force Secretary Michael Wynne said the Air Force should
weigh whether hiring tanker services could hurt the military’s flexibility and
training opportunities.

McEvaddy says the Air Force’s concerns are misplaced and that the Omega DC-10s
will be very similar to its own larger KC-10 fleet, and that it would have the
option of using its own pilots and crew. Citing a Defense Science Board study,
McEvaddy said he expects the Air Force would pay about $10 to $12 per gallon for
Omega’s tanking services, compared to the $17.50 per gallon cost of using
military crews.

Many of Omega’s ex-Air Force staff may choose to stay in the Air Force’s
reserves and could be called up as needed without even changing planes, McEvaddy
said. He said the planes could support combat missions even using civilian
personnel.

“The old bogey is always how do we know we can rely on you in war?” McEvaddy
said. “Nations don’t go to war without the public anyway. If you look at the
historic scenarios - Vietnam, Korea - there were as many civilians in theater as
there were soldiers.”

To illustrate this point, McEvaddy recalled a phone call from his brother, an
accomplished lawyer and pilot who never served in the military, during the first
Gulf War. When queried on how to handle an incoming scud missile attack,
McEvaddy offered the following advice: “I said, make sure the airplanes aren’t
in the same place on the ramp and get into the bunker, Des!”

Unsolicited Bid

Omega has significant experience with the unsolicited bid. The company won its
Navy contract after volunteering a proposal, and it also has offered planes to
the U.K. in case the Ministry of Defence’s main tanker plan doesn’t work out.
Industry insiders say the company has even approached U.S. intelligence agencies
about tanking services for detainee transfers, to reduce dependence on foreign
air fields.

McEvaddy wouldn’t discuss any rendition-related overtures. But he did serve as
an intelligence officer during 10 years in the Irish Army.

Omega Air established itself by dealing in used Boeing 707s, a passenger plane
that is a close cousin of the Air Force’s aging KC-135 fleet. But McEvaddy has
been planning a tanker push for many years, based around the idea of a cargo
plane that could load fuel pallets when needed and head off to war.

The first Omega DC-10 tanker is scheduled to make an appearance at next week’s
Farnborough International Airshow in England. In the long run, McEvaddy hopes
Omega’s tanker services will appeal to the NATO alliance and other U.S. allies,
but the planes can be converted back to cargo planes if there aren’t takers.

McEvaddy has been courting the Pentagon steadily. The company sold the U.S.
military used 707s for its Joint Surveillance Target Attack Radar System, a
Northrop Grumman Corp. (NOC)-designed spy plane commonly known as Joint STARS.

Also, the U.S. Navy recently announced plans to renew the tanker-services
contract it launched with Omega five years ago. Navy pilots say the Omega plane
has been reliable and easy to work with, and Omega is now preparing a second
plane to join the project.

To make further inroads, McEvaddy has met with staff from Sen. John McCain’s
office to discuss the tanker project. McCain, R-Ariz., has been a longtime
critic of the Air Force’s tanker hopes, and his approval is seen as an essential
element of any successful tanker plan.

When the Air Force asked aerospace companies for tanker information in late
April, in the first stage of seeking bids, it invited a wide variety of
proposals. The Air Force solicitation asked for information on new planes,
tanker services and also possible overhauls of the existing fleet.

U.S. Alliances

Omega and U.S. engine-maker Pratt & Whitney, part of United Technologies Corp.
(UTX), have said they could join forces on a re-engineering proposal for the Air
Force’s current tanker fleet. Pratt & Whitney acknowledges the alliance, but
says it is willing to work with the Air Force on its own as well.

“If Omega does get into the tanker business, we would be interested in working
with them, depending on what airplanes and what engines they need,” said Bill
Begert, a retired four-star Air Force general who is now Pratt & Whitney’s
vice-president for business development and international programs.

While Begert says there aren’t any teaming arrangements at present, Omega and
Pratt & Whitney do have a standing relationship. The two companies hope to
secure a long-sought contract to re-engine the 19-plane Joint STARS fleet, and
it won an initial competition.

The project was shelved during a budget debate, but the team now appears on
track to secure its victory at long last. The Air Force wouldn’t name its
prospective winner, but a spokesman said the service has a candidate in mind and
will offer a sole-source contract this summer unless it receives another
proposal at the last minute.

If the Air Force warms to Omega’s tanker offering, the company will buy
another 40 DC-10s to add to its bid.

Financing won’t be an issue, McEvaddy says, citing the brothers’ long-term
banking relationships. The brothers also aren’t overly concerned about
short-term returns on their aircraft investments. “We don’t have shareholders to
worry about where the bottom line is the most important thing. We can take
long-term views,” McEvaddy said.