Another chip falls on the promoter of a constellation of telecommunications satellites that promise important spin-offs in Quebec. Telesat will have to find several hundred million dollars more to put its project into orbit, once again increasing the degree of uncertainty.
Posted at 7:00 am
Even though the Ontario company has seen Quebec and Ottawa promise it $2 billion in public funds, sums that have yet to be paid, it fell $2.5 billion short of realizing the ambitions of the Lightspeed constellation, which had already been degraded.
The company did not want to specify Press the means he intended to take to overcome these financial contingencies.
“Lightspeed represents an interesting investment opportunity, but it is also a guarantee that these discussions will end in a positive outcome”, if it is limited to the words of the investor, the president and chef of the management of Télésat, Daniel Goldberg, In the past week.
Telesat wants to put satellites into low orbit, more than 1,000 km above the Earth, to, among other things, provide high-speed Internet access in remote areas.
Due to the cost explosion resulting from inflation, the 298-satellite constellation will eventually shrink to 188 units. These satellites will be built by Thales Alenia Space.
This slimming diet is not enough. Additional funds will be needed to finance this constellation, whose bill was initially estimated at 6.5 billion. Mr. Goldberg did not quantify the extent of the cost overruns. He had simply said that they were less than 10% of Lightspeed’s initial bill.
“The original plan didn’t materialize,” Caleb Henry, principal analyst at US firm Quilty Analytics, which specializes in aerospace, said in a telephone interview.
The longer Telesat takes to progress, the more time its competitors have to build and launch their own satellites. This is why it is likely to become more and more difficult.
Caleb Henry, Principal Analyst at Quilty Analytics
These strong rivals are players like SpaceX (Elon Musk) and Amazon, who have big ambitions, just like other European developers.
In February 2021, the Legault government had promised Telesat 400 million in exchange for the creation of some 300 jobs in the Gatineau region, where the company promises to build half a dozen facilities. A few months later, Ottawa had awarded $1.5 billion. Together, the two levels of government agreed to finance approximately 30% of the initial bill for the constellation.
Telesat wanted to get the missing $2.5 billion from agencies like Export Development Canada (EDC) and Bpifrance, but this has yet to materialize. Bpifrance risks becoming a shareholder in OneWeb, a rival Lightspeed constellation, following its merger with Eutelsat. The French agency is the main shareholder of Eutelsat. Mr. Henry wonders if this might cool the French agency off about Telesat’s ambitions.
The US analyst also wonders where the Canadian company will pick up the missing funds.
“SpaceX has the ability to convince the markets, Amazon is backed by Jeff Bezos, and OneWeb has a diverse shareholder base,” said Henry. I have yet to see Telesat do the same. »
According to our information, Telesat has not yet knocked on the door of the Legault and Trudeau governments. Last winter, the Minister of Economy and Innovation, Pierre Fitzgibbon, hinted that Quebec had contributed enough to this project, still considered important by both levels of government.
A Telesat subcontractor, the Ontarian MDA, which operates a factory in Sainte-Anne-de-Bellevue, is responsible for manufacturing the active antennas for the satellites. It had to expand its facilities and hire 280 people thanks to a loan of 50 million. The company did not comment on the turn of events at Telesat.
- Year in which Telesat wants to deploy its first low orbit satellites
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