WASHINGTON — Boeing is scrapping a contract with satellite-internet startup Global IP for a geostationary satellite, citing the startup’s inability to finance the satellite.

“Boeing is terminating the Global IP satellite contract for reasons of default for nonpayment,” the company said in a Dec. 7 statement to SpaceNews.

Boeing’s decision to cancel Global IP’s contract for the Gisat-1 satellite, first reported Dec. 6 by The Wall Street Journal, came after the newspaper reported last week that Global IP was being funded, and allegedly controlled, by a Chinese state-owned entity. Global IP’s founders, who left the company, said in a lawsuit filed earlier this year that they were concerned the Chinese government could gain access to sensitive, export-controlled technologies through the Boeing contract. Global IP’s current CEO, Bahram Pourman, denies the company is controlled by China, according to The Wall Street Journal.

Global IP did not respond to calls or emails.

“As a global company, Boeing undertakes rigorous measures to comply with US export regulations and protect national interests,” Boeing said. “Boeing has consulted with the U.S. Commerce Dept. regarding export licensing for the Global IP transaction and will continue to work closely with Commerce officials to ensure appropriate protection of satellite technology.”

Boeing declined to comment on what will happen to the satellite, which was initially planned for a launch this year on a SpaceX Falcon 9 rocket. SpaceX did not respond to questions regarding the status of its contract with Global IP. SpaceX still lists Global IP on its manifest, though the mission had slipped from 2018 before the Wall Street Journal published its Dec. 4 story on Global IP.

Global IP ordered Gisat-1 from Boeing in September 2016. The 150-Gbps Ka-band satellite was designed to provide internet services across Africa starting in 2019.

Caleb Henry is a former SpaceNews staff writer covering satellites, telecom and launch. He previously worked for Via Satellite and NewSpace Global.He earned a bachelor’s degree in political science along with a minor in astronomy from...