Israel MoD Considers Commercial Sale of Ofeq Imagery

Israel’s Ministry of Defense (MoD) is considering a proposal by ImageSat International, owner and operator of the Eros- series imaging satellites, to offer imagery from Ofeq and future government-owned spy satellites for resale on the commercial market.

Billed as a cost-effective means of meeting intensifying demands for strategic intelligence and supporting the nation’s satellite industry, the ImageSat proposal calls for capitalizing on excess capacity of MoD-operated spacecraft.

According to defense and industry sources here, options under discussion include the sale of Ofeq imagery of geographic coverage areas, or footprints, considered non-essential to Israeli national security needs. This option closely resembles the Satellite Operating Partner arrangement ImageSat now has with select anchor customers, a time-sharing plan that provides exclusive rights to independently task the Eros satellites as they pass over a given area with a maximum radius of 2000 kilometers.

“Satellites are national assets that orbit all over the world, but not all geographic areas are necessarily of interest to MoD,” said Shimon Eckhaus, ImageSat chief executive. “I’m talking about enhancing cooperation with MoD by optimizing areas of geographic coverage,” he said.

Another Israeli industry executive was more explicit in the reasoning behind the ImageSat proposal: “It doesn’t make economic sense for the government of Israel to put up its own satellite and use it only for its specific geographic area when the rest of the time — for the most part — the strategic asset goes to waste.”

Under the proposal, revenues from sales would fund development of future hybrid satellites that combine elements from Ofeq and Eros, both of which are produced by state-owned Israel Aircraft Industries Ltd. (IAI). Costs for the new hybrid satellites would be shared by ImageSat and MoD. IAI — a 47 percent owner of ImageSat — is the nation’s sole satellite producer.

“The idea is to blend requirements of the two very high-resolution optical satellites. MoD and ImageSat would contribute their shares of funding and all three parties — MoD, ImageSat and IAI — would benefit from having a larger number of satellites orbiting at any given time,” said an Israeli space industry expert.

If implemented, the proposal would herald a significant revamp of Israel’s military space program and could risk Israel’s problem-plagued Shavit, a launcher built by IAI, whose failures have destroyed at least three satellites since the late 1980s. Eckhaus insists that ImageSat is not opposed to Shavit, and is concerned only about securing successful launches of its future satellites, but industry sources say his firm’s plan for building hybrid commercial-government satellites inherently favors more reliable, less expensive and commercially insurable launchers.

Industry executives and experts here say IAI is vehemently opposed to the ImageSat initiative. When asked to elaborate, Doron Suslik, IAI deputy corporate vice president for communications, said: “IAI, as the largest shareholder in ImageSat, does not want to negotiate with its affiliated company through the press.”

In private conversations, however, industry sources here said IAI’s management views the ImageSat initiative as a turf grab that would undermine IAI on the international space-hardware market as well as in its local role as primary provider of space systems and services to the Israeli government. They also noted that IAI helped sink a proposal to launch — with insurance — the MoD’s Ofeq-6 military satellite with the same Russian Start-1 launcher used by ImageSat to launch the Eros satellites.

Ofeq-6, with an estimated value of $100 million, was lost in a September 2004 Shavit failure.

“These proposals have come up from time to time, but the fact is the government of Israel also could have done this on its own; we didn’t need ImageSat to launch our satellite,” said Shmuel Yachin, a retired brigadier general and former acting director of Israeli defense research and development. Yachin said Israel must retain an indigenous launch capability for reasons of national security. “The decision was made to go with the Shavit, and as painful as it was to lose Ofeq-6, the reasons for that decision remain valid.”

But others note that Israel’s MoD already has made an initial break from the Shavit with its decision late last year to launch its next satellite — the TechSAR synthetic aperture radar — aboard India’s Polar Satellite Launch Vehicle. Embrace of the Indian alternative was driven in large part by a loss of confidence in the Shavit.

Government and industry sources say renewed ImageSat proposals may now be more palatable to MoD, which is under intense pressure to successfully deploy an Ofeq-7 before the Ofeq-5 expires in late 2007 or early 2008. Launched in May 2002 by a Shavit rocket, the Ofeq-5 currently provides the bulk of Israel’s strategic intelligence needs, passing over the Middle East every 90 minutes. Supplementary coverage comes from Eros A, launched in December 2000, and Eros B, which became fully operational in early June following its April 25 launch. Each of the polar-orbiting Eros satellites passes over Israel and neighboring states four times per day.

Space experts here claim there is not much inherent difference in the imaging capabilities of the Eros B — designed to discern objects as small as 70 centimeters across — and Ofeq-5, whose resolution properties remain classified. “Resolution is a function of the satellite camera and orbiting altitude. If you operate both satellites in the same way, the difference in resolution is not significant,” an industry official here said.

Supporters of the proposed future hybrid satellites say this approach would allow MoD to invest scarce resources in additional satellites it otherwise would not be able to afford. As for using alternatives to the Shavit, proponents point to an MoD study conducted in the aftermath of the Ofeq-6 loss that concluded that using foreign launchers to deploy military satellites would pose minimal risk to state security.

“The committee concluded that critical technologies could be safeguarded if Ofeq had to be launched from a commercial alternative,” an industry analyst said July 10.

MoD spokeswoman Rachel Naidek-Ashkenazi declined to comment on the study’s findings, which she said remained classified. According to Ashenazi, MoD is constantly evaluating opportunities for cooperation with regard to future optical satellites, but that no decision has been made yet on the ImageSat proposals. “Budgetary limitations and the constant need to provide the best service for our customers obliges us to examine cooperation that could enable optimization of imagery based on geography,” she said in a written response to questions.

Tal Inbar, a space industry analyst at the Herzliya-based Fisher Institute for Air and Space Strategic Studies, said he welcomed proposals aimed at enhancing MoD’s ability to purchase additional satellites. Nevertheless, he warned that Israeli deterrence could be harmed through commercial sales of Ofeq imagery, which would reveal heretofore classified capabilities of the spy satellites.