PARIS — Satellite fleet operator ABS’s planned purchase of a third all-electric telecommunications satellite from Boeing has been stalled since the July 1 closure of the U.S. Export-Import bank, whose financing had been key to the deal, ABS and industry officials said.
The contract, valued at about $90 million, is currently in a suspended state as Bermuda-based ABS and El Segundo, California-based Boeing Space and Intelligence Systems investigate alternative financing mechanisms for the ABS-8 satellite, and assess whether Ex-Im is likely to reopen this autumn.
“Since the first of July we have continued to work with Boeing on ABS-8 in considering other financing options for the ABS-8 program,” ABS Chief Executive Tom Choi said Aug. 5 in response to SpaceNews inquiries.
“We did not expect that Ex-Im would lose its authorization when we signed the contract. Ultimately if Ex-Im doesn’t regain its ability to lend we may have to consider other options. I can’t confirm or deny that the contract is in place, but we are proceeding with [Boeing] as if Ex-Im will return.”
Ex-Im, the United States export-credit agency, was shut down for new business as of July 1 when the U.S. Congress failed to approve a re-authorization measure. Ex-Im backers said the agency has the support of the majority of the Congress and that they will attempt to re-authorize it after the congressional summer recess.
“At this time Boeing continues to discuss with ABS the terms of an agreement involving a 702 satellite,” Boeing said in an Aug. 5 statement, referring to the company’s 702 series of satellite platforms, which includes the 702SP all-electric design.
Boeing and ABS announced the ABS-8 agreement in June, with the understanding that a commitment was subject to Ex-Im backing. ABS and Boeing have worked with Ex-Im before on satellites, notably the ABS-3A satellite launched aboard a SpaceX Falcon 9 rocket in March along with the nearly identical Eutelesat 115 West satellite for Eutelsat of Paris.
Both these satellites are reported healthy in orbit. One of the features of all-electric propulsion is that a longer time is needed for a satellite to reach its operating position after separation from its rocket.
Eutelsat and ABS are combining again to launch two additional Boeing-built 702SP satellites aboard a single Falcon 9. That launch had been scheduled for late this year before the June 28 SpaceX launch failure. Hawthorne, California-based SpaceX has not announced an updated flight schedule beyond saying it hoped that all customers scheduled for launch in 2015 would in fact be launched before January.
Choi did not mention it, but the French export credit agency, Coface, has suffered none of the reauthorization drama of Ex-Im. It remains open and available for France-based satellite builders Airbus Defence and Space and Thales Alenia Space.
In addition to their having a functioning export-credit agency, the European satellite builders are benefiting from the rise in the U.S. dollar against the euro, which makes U.S. products more expensive than before compared to European products.
Before the Ex-Im closure stalled the program, ABS and Boeing had planned ABS-8 to be ready for launch in 2017, to replace the ABS-7 satellite now at 116.1 degrees east. The satellite was to carry 50 transponders in C-, Ku- and Ka-band, including high-throughput spot beams in Ku- and Ka-band for coverage of Asia, the Middle East and Russia.
Choi said at the time that, unlike the previous two all-electric satellites ABS had ordered from Boeing, ABS-8’s business case did not depend on finding a similar satellite to share a launch aboard a Falcon 9.
Ex-Im Bank continues to process all satellites whose financing was formally approved by June 30. Industry officials have said that if the bank reopens this fall, U.S. satellite builders and U.S. launch service providers – the latter being SpaceX and Lockheed Martin Commercial Launch Services – are unlikely to lose much business.
But a longer-term shutdown at some point would force satellite owners to look at European and Japanese options for commercial telecommunications spacecraft, and at European, Japanese and Russian launch alternatives.