Chilean President Sebastian Pinera has been making budgetary adjustments amid increased demands for government spending on infrastructure, education and energy development. Protests over education inequities and alleged favoritism of the privileged few have threatened to destabilize Pinera's administration.
Pinera's approval ratings have suffered as the protests continued.
While youth discontent simmers, the government has thought it wise to go easy on major defense outlays. It is also concentrating resources on developing the country's energy sector and defense spending isn't seen as a priority.
Although the Chilean navy is reported awash with cash accumulated from its mandated share of copper export earnings, the military is known to be a cautious spender.
The costs of replacing aging Lockheed P-3 Orions as opposed to securing comprehensive upgrades were not discussed.
The navy hopes upgrades will enable the P-3 Orions to continue flying through 2030, InfoDefensa.com said in a dispatch.
Chile acquired the Orions from U.S. stockpiles and three remain in active patrol service, the Chiledefense blog said.
The Lockheed P-3 Orion is a four-engine turboprop, anti-submarine and maritime surveillance aircraft originally developed for the U.S. Navy and introduced in the 1960s. Lockheed based the aircraft on the L-188 Electra commercial airliner but Orion is celebrated for its distinctive tail stinger used for the magnetic detection of submarines.
The original design has undergone numerous upgrades and Chile wants the P-3 aircraft in its inventory to be upgraded to the latest available avionics and other features. The aircraft is usually equipped for anti-surface warfare and anti-submarine warfare in addition to reconnaissance and patrol.
The upgrade will include engine overhauls, new wings and the capability to launch Harpoon anti-ship missiles, InfoDefensa.com.com said.
In contrast, the U.S. Navy's remaining P-3C aircraft are to be replaced by the Boeing P-8A Poseidon.
Speculation about Chilean plans for replacing the Orions with another aircraft arose after the Latin American country began taking deliveries of C-295 Persuader from European manufacturer EADS.
Original plans called for Chile to buy three C-295s with options on another five, EADS said on its website.
Chilean air and naval defense has faced challenges amid the growth of organized drug cartels in the region. Brazil frequently has to bomb and destroy airfields built sometimes overnight in the Amazon jungle by drug traffickers running narcotic airlifts to Central and North America.
Chile hasn't reported a similar problem but its long, narrow strip of land between the Andes mountains to the east and the Pacific Ocean to the west borders Peru, Bolivia and Argentina. Air and border patrols are a major priority for both Chilean air force and the navy.