CNES Plans To Repay Ariane-Related Debt by 2010

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  Space News Business

CNES Plans To Repay Ariane-Related Debt by 2010

By PETER B. de SELDING
Space News Staff Writer
posted: 30 January 2008
02:38 pm ET





PARIS —


The French space agency, CNES, expects to repay its current debt of 290 million euros ($424




million) to the European Space Agency (ESA) by 2010 without increasing its annual ESA contributions beyond the French government-ordered ceiling of 685 million euros, CNES officials said.

Europe’s largest national space agency incurred the debt in 2003 when it assumed a large share of the costs associated with returning the heavy-lift Ariane 5 rocket to flight following a December 2002 failure.

ESA governments agreed to a series of limited-duration financial-support programs to assure the continued viability of the Ariane launch system and specifically the Ariane 5 rocket.

With France’s ESA contributions insufficient to cover its other ESA expenses and the Ariane 5 emergency funding, ESA agreed to finance a portion of these costs from its own budget. ESA often finds itself with a temporary cash surplus when its programs fall behind schedule and do not need to tap the financial resources allotted for




them as soon as expected.

CNES Financial Director Laurent Germain said the agency had long planned that its annual program commitments to ESA, which starting in 2003 were above CNES’s annual spending limit for ESA, would soon fall below the limit, with the extra cash available for loan repayment




.

Following a multi




year agreement with the French government, CNES devotes 685 million euros per year to ESA programs. That figure is frozen through 2010. CNES’s national budget, which is used for France’s domestic space efforts and programs run with other nations outside the ESA context, is 728 million euros in 2008. The




multi




year budget agreement calls for CNES’s




non-ESA budget to rise by 1.5 percent per year.



Germain said the Ariane 5-related debt repayments may need to extend beyond 2010 depending on what ESA programs are adopted by the French government in November during a conference of European space ministers to set ESA’s long-term program priorities.

“Our current plans are to retire this debt in 2010 and there’s no reason we can’t do it under current circumstances,” Germain said Jan. 24. “But the ESA ministerial meeting in November may include program commitments by France that include payments due in 2009 and 2010. Depending on what these commitments are, it’s possible that we may need to extend the repayments past 2010.”

CNES President Yannickd’Escatha declined to detail what long-term efforts CNES would back at the November meeting, saying the government has only begun to review its options in concert with other ESA nations.

In a Jan. 24 presentation of the agency’s budget and strategy, d’Escatha was especially noncommittal on widening Europe’s




manned-space program. “This needs further study, but I know we should not close the door” on a crew-transport vehicle designed in Europe, d’Escatha said.

Richard Bonneville, CNES deputy director for strategy and international relations, said one firm CNES priority for the ministerial meeting is that the ExoMars mission, which includes a Mars rover, be financed to assure a launch in 2013. ESA governments will be asked for about 1 billion euros for the mission.

In what appears to signal a shift in CNES policy, d’Escatha said CNES would seek to tie its investment to “the growth in the market for satellites and launchers, stimulated by the growth in operational services and their replacement.”

As a research and development agency, CNES




historically has not concerned itself with market-related issues. D’Escatha said current CNES thinking is that government-industry partnerships, in which both sides contribute financing, offer new promise.

D’Escatha
specifically praised the British company, Paradigm Secure Communications, whose multi




year service agreement with the British Defence Ministry and with NATO he said should serve as a model.

Paradigm, owned by Astrium Services, is financing the construction of at least three large Skynet 5 military telecommunications satellites and making other investments in return for guaranteed annual payments from British defense authorities. Paradigm owns the ground and satellite assets.

The French Defense Ministry has retained its historic practice of purchasing its satellites from industry and operating them itself, although for the Spot 5 civilian Earth observation satellite it entered a partnership with industry for a part of that satellite’s payload.

D’Escatha
said that for several planned European government satellite systems, agencies like CNES should agree to make the initial investment only when other government bodies – environmental or meteorological agencies, for example – agree ahead of time to invest in follow-on generations of satellites.



“If we cannot promise users that there will be a continuity of services, they will never agree to back these systems,” d’Escatha said.