The Pentagon Wednesday announced a possible contract with Taiwan to continue training F-16 fighter pilots in Arizona and provide air-to-air missiles for live fire drills.

The contract, which was notified to the US Congress, was valued at as high as 280 million dollars.

It includes 10 AIM-9M Sidewinder missiles and five AIM-7M Sparrow missiles for live fire exercises at Luke Air Force Base in Arizona, the Pentagon said.

The contract also provides for the continuation of a program to train Taiwanese pilots at Luke Air Force Base and logistics support for F-16 fighter aircraft, it said.

"It is vital to the US national interests to assist the recipient in developing and maintaining a strong and ready self-defense capability, which will contribute to an acceptable military balance in the area," the Defense Security and Cooperation Agency said in a statement.

It said the sale was consistent with the Taiwan Relations Act, under which the United States pledges to supply Taiwan with arms needed to defend itself.