Lockheed Poised To End Dry Spell with Arabsat Order

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PARIS — Satellite fleet operator Arabsat of Saudi Arabia has selected Lockheed Martin Space Systems to build two telecommunications satellites following an international competition, industry officials said.

Riyadh-based Arabsat has apparently set aside an award of a third satellite until further notice, officials said. One official said the award is for one satellite for the Arabsat-owned Hellas Sat of Greece, and the other for Arabsat’s Middle East-focused fleet.

Arabsat declined to confirm the decision, but other industry officials said Denver, Colorado-based Lockheed has ended a long dry spell with a major award from a growing satellite fleet operator with which it had not previously done business.

“Arabsat is in the final stages of bidding and awarding the manufacturing and launch of its new satellites, at different orbital positions, for Europe, the Middle East and Africa,” Arabsat said in a March 10 statement.

Lockheed officials have been saying for the past three years that the company’s previous focus on U.S. government satellites was shifting as major government developments ended and no new ones emerged.

The commercial market, while not necessarily growing, has remained healthy at between 20 and 25 commercial geostationary-orbiting telecommunications satellites ordered per year in more or less open competitions.

Lockheed officials have said they were reducing the cost of production of their A2100 telecommunications satellite frame to give the company’s sales personnel a product that could compete on the commercial market, where telecommunications satellite prices in general are much lower, on a per-megahertz-delivered basis, than in the military sector.

The Lockheed win comes at a time when its European competitors, notably Thales Alenia Space of France and Italy and Airbus Defence and Space, are sharpening their competitive offers as a result of the decline of the euro against the U.S. dollar, which makes European products less expensive.

Thales Alenia Space won the last Arabsat order, in mid-2014, for a satellite to carry a dual payload for the Arabsat-owned HellasSat of Greece and for London-based Inmarsat. Arabsat calls this satellite Hellas-sat 3, and Inmarsat calls it Europasat.

The next Arabsat satellite to launch, Badr-7, formerly called Badr-6B, is nearing completion by Thales Alenia Space and Airbus.

It was not clear whether one or both of the Lockheed-built satellites would carry an all-electric propulsion system. Lockheed has been marketing a Hall-effect thruster for its commercial A2100 bids, saying that while heavier than the all-electric thruster offered by competitor Boeing Space and Intelligence Systems of El Segundo, California, it delivers satellites to geostationary orbit more quickly.

In addition to a lack of new commercial orders, Lockheed Martin is negotiating a difficult passage of its only current customer, NewSat of Australia, whose financial condition has worsened.

NewSat as of late December was in breach of its loan covenants. The company said it hoped to have completed negotiations with the U.S. and French export-credit agencies by April with an agreement that would permit the company to restart payments to Lockheed Martin and Europe’s Arianespace launch consortium for the construction and launch of the satellite, called Jabiru-1.