The European Commission on Oct. 26 announced it has signed a contract with German and Italian centers to operate the initial 18-spacecraft constellation of Galileo navigation satellites.

The contract, valued at 194 million euros ($271.6 million), calls for a joint venture company called SpaceOpal GmbH to operate the 18 satellites expected to be in orbit by late 2014, and to build out a ground network compatible with these spacecraft.

SpaceOpal is a joint venture of the German Aerospace Center, DLR, and Telespazio of Rome.

The contract, which runs through late 2014, means the commission has completed negotiations on four of the six work packages — system engineering support, satellite construction, launch vehicles and now operations. The two remaining packages, for ground mission infrastructure and ground control infrastructure, are expected to be signed in early 2011, the commission said in its Oct. 26 announcement.

Commission officials expressed relief that a proposed third Galileo control center, which Spain had insisted on for its territory, will not be built, meaning extra costs inherent in providing for a third center have been left out of the SpaceOpal contract.

Carlo Gualdaroni, chief executive of Telespazio, said the number of links required to assure full redundancy with a third site — in addition to the centers in Fucino, Italy, and Oberpfaffenhofen, Germany — would have added substantially to the cost of the operations work even if the Spanish government had agreed to build the center in Spain with Spanish government money.

The contract calls for SpaceOpal to control the medium Earth orbiting Galileo satellites, monitor network reception equipment worldwide and perform on-ground processing of navigation data.

If the Galileo constellation is later expanded to 30 satellites, as is planned, the ground network will need to be expanded under a separate contract.

Peter B. de Selding was the Paris bureau chief for SpaceNews.