Israel announced on Thursday the signing of a contract worth more than $34 million to develop “an extended-range” capability for the F-35 Adir fighter jet.

The Defence Ministry said in a statement that its Defence Procurement Directorate signed the deal with Cyclone, a wholly owned subsidiary of Elbit Systems.

The agreement covers “the development of an extended-range capability for the F-35 ‘Adir’ fighter jet, manufactured by Lockheed Martin,” the statement added.

“The deal, valued at over $34 million (over NIS 100 million), covers the development and integration of external fuel tanks based on an existing Cyclone design originally developed for the F-16,” it said.

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The new capability is expected to extend the aircraft’s “operational range, reduce reliance on aerial refuelling, and enhance operational flexibility across long-range missions,” the ministry said.

The deal comes amid regional tensions, which have escalated after the US and Israel launched strikes against Iran on Feb. 28, triggering retaliation from Tehran against Israel, as well as US allies in the Gulf, along with the closure of the Strait of Hormuz.

A ceasefire took effect on April 8 through Pakistani mediation, but talks in Islamabad failed to produce a lasting agreement. US President Donald Trump later extended the truce without a set deadline.

According to Israeli media, Tel Aviv has raised its military alert level in preparation for a possible resumption of war with Iran if negotiations between Tehran and Washington fail.