Northrop Grumman Corp. may receive a termination fee in the tens of millions of dollars to compensate it for the Defense Department decision to withdraw its contract to build a new fleet of aerial refueling tankers.

Undersecretary for Acquisition John Young told Bloomberg News on Thursday that the department will negotiate with the Los Angeles-based defense contractor for a fee in the range of “tens of millions of dollars.”‘

“They are entitled to certain amounts of money,” Young said. “We are certainly going to negotiate with them aggressively and try not pay anything more than we have to. But unfortunately, in my opinion, they are entitled to something.”

Northrop and its partner, European Aeronautic Defense and Space Co., won an initial contract in February for the development and purchase of four test aircraft for $1.5 billion, with options to build 64 aircraft for $10.5 billion. The contract ultimately could have totaled 179 tankers, valued at $35 billion.

Boeing Co., which had been favored to win the contract, successfully contested the award, citing problems with the Air Force’s procedures. The Defense Department eventually decided to wait until a new administration is in office before rebidding the contract.