— Satellite fleet operator AsiaSat has scrapped a contract to launch its AsiaSat 5 spacecraft aboard Sea Launch Co.’s new Land Launch vehicle in favor of an International Launch Services Proton launch in July or August, AsiaSat announced Feb. 23. The decision will cost based AsiaSat some $35 million in extra launch fees but will put AsiaSat orbit a year earlier than currently scheduled.

AsiaSat told the Hong Kong Stock Exchange that it had canceled a contract with Long Beach, Calif.-based Sea Launch when it became clear that the Land Launch operation would not be ready for AsiaSat 5 until mid-2010.

AsiaSat had long said it could wait no later than mid-2009 for the launch because AsiaSat 5 is intended to replace the AsiaSat 2 satellite now at 100.5 degrees east. AsiaSat 2 is scheduled to be retired in mid-2011.

AsiaSat had said it needs to launch AsiaSat 5 soon enough so that, if the launch fails, it has sufficient time to order a replacement satellite to be in orbit before AsiaSat 2 is taken out of service.

That requirement seemed to be satisfied by Sea Launch when the AsiaSat 5 contract was signed in mid-2006. But then Sea Launch began reporting hiccups in its supply chain, which must feed both Land Launch and the normal Sea Launch operations.

Land Launch operates from the Russian-run BaikonurCosmodrome in . Sea Launch’s traditional operations are from a floating platform on the equator in the . Both use the same basic Russian-Ukrainian Zenit-3 rocket.

AsiaSat said it had budgeted $180 million for AsiaSat 5, including $45 million for the launch, $95 million for the 3,500-kilogram satellite’s construction by Space Systems/Loral of Palo Alto, , and $40 million for insurance and other expenses.

In its Feb. 20 filing with the Hong Kong Stock Exchange, AsiaSat said Sea Launch had informed the company that AsiaSat 5’s planned 2009 launch had slipped to mid-2010.

“We have been working this issue for some time and we have been very open with all our customers about our schedule,” Sea Launch President KjellKarlsen said in a Feb. 24 interview. “There have been delays in the Land Launch program, and these delays have been more than some customers can bear.”

Karlsen said his company expects to launch three Sea Launch rockets and three Land Launch variants in 2009. The three Sea Launch payloads are the Sicral 1B military telecommunications satellite for the Italian government; the W7 telecommunications satellite for Eutelsat of Paris; and the XM-5 radio broadcast satellite for Sirius XM Satellite Radio of the United States

The three Land Launch campaigns scheduled for 2009 are the Telstar 11N satellite for Telesat ; the Intelsat IS 15 satellite for Intelsat Ltd. of and 3a spacecraft for Measat Satellite Systems of Malaysia. Karlsen said that there is no reason to think that the supply chain issues that have slowed Sea Launch’s activity will prevent these six launches from occurring as scheduled.

AsiaSat said it had secured a commitment from Reston, Va.-based International Launch Services to launch AsiaSat 5 between July 15 and Aug. 15 for $80 million.

The said it now expects the entire AsiaSat 5 program to cost $215 million – a $35 million increase due to the higher Proton cost – implying that neither the construction nor the insurance costs will change as a result of the shift from Land Launch to Proton. AsiaSat also apparently expects to receive a full refund from Sea Launch given that a mid-2010 launch date is sufficiently beyond the contractual launch date as to permit the contract to be terminated for default. Karlsen confirmed that this was in fact the case.

AsiaSat, which is now preparing an AsiaSat 6 satellite, said it may elect to preserve a Land Launch option for that satellite instead of seeking a refund of the prelaunch payments it had made to Sea Launch.

In a Feb. 24 statement, International Launch Services President Frank McKenna said: “Due to another customer’s change in plans we have hardware and manifest availability to support AsiaSats schedule needs.”

International Launch Services spokewoman Karen Monaghan said the mid- 2009 Proton slot opened when development of CMBStar, a Loral-built satellite ordered by EchoStar Corp. of Englewood, Colo., and intended to provide mobile television service in China, was suspended.