Satellite-fleet operator SES will not attempt to salvage its AMC-14 telecommunications satellite, placed into a useless orbit following a March 15 launch failure by its Proton-M rocket, having concluded that such efforts would be risky, time-consuming and result in little operational life for the satellite even if successful, SES announced April 11.
Mark Rigolle, chief financial officer of the Luxembourg-based company, said SES would update investors on the revenue impact of the loss of the satellite when it presents its first-quarter earnings
In an April 11 interview, Rigolle declined to speculate on whether SES would revise its previous forecast of better than 6 percent average annual revenue growth between 2008 and 2010 as a result of the loss.
AMC-14, a Lockheed Martin A2100AX model platform carrying 32 Ku-band transponders, had been fully leased for its entire 15-year life by U.S. satellite-television provider EchoStar of Englewood, Colo. The satellite was intended to be placed at EchoStar’s 61.5 degrees west orbital slot.
AMC-14 was insured for some $192 million – $150 million in coverage purchased by SES, and the rest purchased by EchoStar, which had helped pay for the satellite’s construction.
AMC-14 will not be replaced, SES spokesman Yves Feltes said April 11. The contract between SES and EchoStar for the satellite has now been cancel
Rigolle said that while AMC-14 would have been an unusually risk-free satellite for SES because of EchoStar’s commitment, it would have been among the least profitable for the same reason
SES has established minimum requirements of 10 percent and 15 percent internal rates of return before it invests in satellite programs. Because the company would not have to pay marketing and other costs associated with finding and keeping customers for AMC-14, the satellite was built using the lower end of the profitability threshold, Rigolle said. “You cannot take our 38-satellite fleet and say, this would have been equivalent to one-thirty-eighth of our revenues,” Rigolle said. “It would have been less.”
A premature shutdown of the Proton-M rocket’s Breeze-M upper-stage engine left AMC-14 in an orbit with an apogee of about 28,000 kilometers and a perigee of 6,250 kilometers. The intended orbit was 36,000 kilometers and
Immediately following the failure, SES expressed optimism that it could bring the satellite to its intended destination through a lunar gravity-assist maneuver or by placing AMC-14 into what is called a super-geostationary orbit.
In 1998, the HGS-1 commercial telecommunications satellite that had been stuck in a similar orbit was sent around the M
oon twice in a slingshot maneuver that ended with it
being positioned in geostationary orbit. But nearly all its fuel was consumed
in the maneuver.
Feltes said SES and manufacturer Lockheed Martin Commercial Space Systems of Newtown, Pa., concluded that any similar attempt for AMC-14 would carry risks, take at least several months to accomplish and would leave them with a satellite of little commercial value even if everything went according to plan.
“We could not make the numbers work,” Feltes said. “Even if we could get it into geosynchronous orbit within a reasonable time – up to 12 months – its fuel tank would be nearly empty. If we could have gotten two or three years of life from the maneuver, we would have gone for it if only to gain the experience.”
Once they accept SES’s claim of a total loss, insurance underwriters have 90 days to pay the claim. Once that is done, they can take ownership of the satellite and try to find some other use for it, or order that it be deorbited.