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NewSat after more capital for Jabiru-1 satellite

Australian satellite company NewSat expects additional funding will be needed to finance the delayed launch of its Jabiru-1 project.
Written by Aimee Chanthadavong, Contributor

While NewSat's AU$620 million satellite program Jabiru-1 is getting closer to launch, the company has said it requires further capital injection.

The satellite, which was due to launch in mid-2012, will be a hybrid Ku- and Ka-band satellite, and will provide coverage over South-East Asia, the Middle East, and North Africa. It is now expected to be launched in mid-2015.

In an ASX announcement on Wednesday, the company said the capital required is expected to be approximately 6 percent of the total project value.

The company also said discussions with multiple parties have given the company "a high degree of comfort that capital is available from a range of sources".

"NewSat is exploring several avenues for the introduction of this funding into the Company this calendar year," it said.

This is despite the fact that NewSat's CEO Adrian Ballintine had said last year that the company secured all AU$611 million it required for the Jabiru-1 satellite launch, including the AU$105 million it secured in equity in February 2013.

The company has also signed a number of deals with companies ranging from Pakistani telecommunication companies to the US military for capacity on the satellite over 15 years.

Construction of the Jabiru-1 spacecraft continues to be carried out by Lockheed Martin in the United States, even while NewSat continues to have ongoing discussions with the financiers of the project over an alleged technical breach connected to a drawdown of previously announced AU$10 million loan from Every Tycoon.

"NewSat’s Jabiru-1 satellite project build is not on hold or suspended," the company confirmed.

Critical design review of the Jabiru-1 satellite was completed earlier this year and regular program review meetings are being held during the satellite manufacturing process.

A second satellite, Jabiru-2, will provide satellite services over Australia. It is anticipated to be launched in September where Jabiru-2 will then undergo in-orbit testing and will be placed in operational service, approximately four weeks after launch.

Last December, NewSat offered to buy two of NBN Co's Ka-band satellites off the government, according to a submission (PDF) from the satellite company to the government's broadband cost-benefit analysis panel. Currently under construction in the United States with Loral, and due for launch in 2015, the satellites are expected to service 3 percent of premises in Australia where broadband services will continue via the satellites.

"NewSat contends that privatisation will benefit the NBN Co by dramatically reducing debt and de-risking the provision of the service by introducing an experienced, efficient, quality service provider. It is anticipated that this would also result in a significant reduction in staffing required by NBN Co," NewSat founder Adrian Ballintine said in the company's submission.

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