Monday, November 11, 2013

MDA Denied Export Permits for Russian Satellites

          by Brian Orlotti

As outlined in the November 4th, 2013 MacDonald Dettwiler (MDA) Q3 investors conference call, the Canadian government has denied the iconic Canadian company permission to participate in an international competition to provide radar Earth observation satellites to Russia.
Dan Friedmann.

According to November 6th, 2013  SpaceNews article "Canada Blocks MDA Corp. from Russian Radar Satellite Competition," the Russian government had been soliciting prospective bidders on a radar Earth observation system for the past year. MDA is currently under contract to the Canadian government to develop the three-satellite Radarsat Constellation Mission (RCM), and so was considered a likely bidder for the Russian work.

But in response to an investor’s question during the conference call, MDA CEO Dan Friedmann stated:
Sure. Russia is very active. They have an RFP for a communications satellite on the street right now due January, which we're bidding, and they have an RFI for two other communications satellites that may be purchased in the first quarter. So they're going through three procurements in the communications area at this point. We have been unable to obtain any export permits approvals to supply them with their radar RCM-type needs, so we're out of that game.
The Canadian’s government’s decision will likely limit the Russian competition to European firms. EADS Astrium has shown interest in the contract as a chance to expand its existing constellation of radar imaging satellites (TerraSAR-X and TanDEM-X) co-developed with the German Space Agency (DLR). DLR officials have also publicly expressed support for an Astrium bid.

Despite the radar satellite setback, Friedmann emphasized that MDA Corp. has other irons in the fire, both with Russia and other nations. MDA is responding to a Russian RFP for a communications satellite due in January and will respond to an RFI for two more commsats expected in the coming weeks. Friedmann also said that MDA is seeking to collaborate with Russia on space robotics projects. Aside from Russia, Friedmann stated that “bidding activity (for communications satellites) continues at a high level” with MDA winning five telecom satellite contracts thus far in 2013.

Although the Canadian government’s reasons for obstructing the MDA radar satellite bid are unclear, the move appears out of sync with recent policy changes aimed at increasing Canada’s competitiveness (as outlined in the November 7th, 2013 Space News article "Canada Revamps Satellite Regulations To Make Industry More Competitive."
Brian Orlotti.

If national security issues were the driver behind the government’s decision, one is tempted to ask why the German government isn’t taking a similar stance. Is Canada unnecessarily denying itself an opportunity? It remains to be seen if future Canadian attempts to expand into international markets will not be so hampered.

Brian Orlotti is a Toronto-based IT professional and the treasurer of the Canadian Space Commerce Association (CSCA).

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