The U.S. Army has signed a $78 million deal with Lockheed Martin, one of the world's largest defense contractors, to upgrade its surface-to-surface Army Tactical Missile System (ATACMS), the Bethesda, Maryland-based advanced technology company announced Wednesday.

As part of the deal, Lockheed Martin will take hardware from early-production ATACMS Block 1 missiles to develop an enhanced weapon system. The upgraded missile system is expected to be capable of hitting targets without the risk of unexploded ordnance, which, according to the defense contractor, meets the U.S. Army’s long-range precision strike requirement.

The first phase of the upgrade program will include flight tests, followed by the start of production in 2016 at Lockheed Martin facilities in Camden, Arkansas and Dallas.

“ATACMS is extremely reliable and effective, and has proven itself over and over again in combat,” Ken Musculus, vice president of Tactical Missiles for Lockheed Martin Missiles and Fire Control, said in a statement.

The ATACMS, which is about 13 feet in length and 24 inches in diameter, is the U.S. Army’s only tactical long-range precision surface-to-surface weapon, which can eliminate targets as far as 185 miles.

“ATACMS is a long-range, guided missile that gives commanders the immediate firepower to shape the battlespace. Each ATACMS missile is packaged in a Multiple Launch Rocket System look-alike launch pod, and is fired from the MLRS family of launchers,” according to the company.

Lockheed Martin claims to have produced more than 3,700 ATACMS missiles over the past 20 years, while over 560 of them have been fired in combat, including during the Persian Gulf War and Iraq War, Ria Novosti reported.