International Launch Services (ILS), the U.S.-based company that sells the Russian Proton-M rocket commercially, has been given assurances by the Russian government and by Proton’s builder that a steady production of six commercial rockets per year will be available for the global market.

Nine months after ILS’s reorganization

following the exit of Lockheed Martin as majority shareholder, the company is benefiting from the reorganization of Russia’s space-hardware sector, ILS President Frank McKenna and Wendy Mihalic, the company’s vice president of sales, said in a June 19 interview.

Proton’s prime contractor, the government-owned Khrunichev Space Center of Moscow, has been given broad new responsibilities and now has control over the full Proton production process.

In particular, McKenna said, the Breeze-M upper-stage engine, which has caused ILS difficulties in the past,

now is under Khrunichev control. Breeze-M engines, which used to require 60 days of production, now are produced in 45 days, he said.

“The reorganization permitted Khrunichev to free up critical resources for the Breeze-M engine,” McKenna said. “More investment and upgrades are coming in 2007 following a Russian presidential decree. By the end of 2008, Khrunichev is to be in full control of the full Proton cycle –

structure, avionics, electronics and the upper stage.”

Following the exit of Lockheed Martin from ILS in October 2006, ILS

now is owned 51 percent by Space Transport Inc., a company created for that

purpose by ILS director Mario Lemme. The remaining

49 percent is owned by Khrunichev.

“The transaction left us with no debt and a very good balance sheet,” McKenna said. “The market in general has seen launch-service price increases over the past several years and prices are now leveling off. It is now a stable business model for commercial launch-service providers, and this is in the interests of the entire satellite telecommunications industry.”

The sharp price increases

for raw materials in Russia also seem

to be abating, he said, adding: “The Russian Federal [space] program does not want costs to go up.”

With renewed investment from the Russian space agency, Roskosmos, and an improved commercial outlook, Khrunichev will be able to produce 10 to 12 Proton rockets per year. Four or five of these will be for Russian government launches, which are outside ILS’ authority.


already has signed contracts this year for 10 launches, including five for SES of Luxembourg, plus three others that the company says are firm but that have not been announced. During the Paris air show here, ILS announced six new launch contracts including five with SES and one with Arabsat.

Industry officials speculated that one of these unnamed customers is DirecTV Group, for the DirecTV 11 satellite that was to have been launched aboard a Sea Launch Co. vehicle. Sea Launch has been grounded since its January failure, and several customers have sought alternative suppliers to assure they are in orbit to meet regulatory or customer requirements.

Paula Korn, spokeswoman for Long Beach, Calif.-based Sea Launch Co., said June 21 that the company remains under contract to launch DirecTV 11.

ILS said the 13 launch contracts it

signed between January and mid June have an aggregate value of more than $1 billion. The company’s total backlog stands at 21 satellites.

McKenna said ILS also was

confident of winning a contract to launch one or both of the Yahsat commercial

and military telecommunications satellites for Mubadala Development Co. of United Arab Emirates.

In keeping with a policy adopted just before Lockheed Martin’s exit


no longer is seeking to launch small satellites such as the

Thor 2R spacecraft, owned by Telenor of Norway, which ILS is

scheduled to launch

later this year.

“We will stick to the medium and large satellites, we are not going to be going after everything,” McKenna said, adding that there are no plans to introduce a new, medium-lift vehicle into the ILS portfolio.

Sea Launch and Arianespace, the Evry, France-based launch consortium, both are adding to their rocket families with vehicles adapted for satellites weighing less than 3,500 kilograms.

The scheduled launch this year of DirecTV Group’s DirecTV 10 television-broadcast satellite will be the first Boeing 702-class spacecraft carried by Proton-M and will demonstrate the vehicle’s new capacity to carry satellites weighing up to 6,300 kilograms into geostationary transfer orbit, McKenna said.