Washington — Imaging satellite operator GeoEye expects to file a $40 million insurance claim for what is now expected to be the total loss of its OrbView-3 satellite, whose main camera malfunctioned without warning March 4, company officials told financial analysts March 19.

William Schuster, chief operating officer of Dulles, Va.-based GeoEye, said ongoing attempts to restore the satellite to operations have a “low probability” of success. “In short, while disappointing, I believe the most prudent approach is that we consider OrbView-3 as no longer being a viable part of our constellation going forward.”

OrbView-3, launched in 2003, has been returning only blank white images since March 4 , Schuster said. The satellite failed to send out any sort of warning about a glitch, and subsequent testing has not turned up a root cause, he said.

GeoEye remains in control of OrbView-3 and the problem appears limited to the electronics on the satellite’s imaging camera , Schuster said. “We have yet to isolate a single circuit or component that can fully explain the problem,” he said. Teams are expected to spend another two or three weeks trying to resolve the problem , he said.

Henry Dubois, GeoEye’s executive vice president and chief financial officer, said during the conference call that the company expects to consider OrbView-3 a total loss and collect $40 million in insurance — just $500,000 less than its book value as of Dec. 31.

The primary customer for OrbView-3 imagery is the U.S. National Geospatial-Intelligence Agency (NGA), which has a multiyear data-purchasing arrangement with GeoEye. OrbView-3’s image-collection obligations will be handled in part by GeoEye’s Ikonos satellite, which the company acquired with its purchase of rival Space Imag ing in January 2006.

Ikonos has four times the collection capacity of OrbView-3 and is expected to operate until mid 2008, according to Schuster.

“Ikonos continues to operate substantially the way it has since the acquisition,” Schuster said. “It is meeting all of its performance specifications.”

Dubois said the cash impact of OrbView-3’s apparent loss is expected to be minimal given the company’s ability to fulfill its contractual obligations with other satellite assets and the anticipated insurance payment.

In March 23 interview, Schuster said that between Ikonos and GeoEye’s next satellite, the more capable GeoEye-1, the company should be able to fulfill all of its contractual obligations to the NGA and other customers. GeoEye-1 is slated to launch during the second half of 2007.

Unlike OrbView-3 , GeoEye-1 has redundant imaging systems designed by ITT Space Systems of Rochester, N.Y. General Dynamics Advanced Information Systems of Gilbert, Ariz., is the prime contractor and is integrating the imaging system into the 1,890-kilogram GeoEye-1 platform , said Mark Brender, a company spokesman.

GeoEye has begun shifting OrbView-3 staff to other projects, primarily GeoEye-1, Schuster said. No job losses are expected.