Defence axes JP9102, its $7bn MILSATCOM project

The Australian Department of Defence has announced that it will not be proceeding with project JP9102, its $7 billion strategic military satellite communications (MILSATCOM) program.

In a statement issued on Monday, 4 November, Defence explained that it went out to tender in 2021 for a geostationary Earth orbit (GEO) satellite communications system. In April 2023, the government selected Lockheed Martin Australia as the preferred bidder for the project, which aimed to launch several large military-grade satellites and would also involve multiple ground stations across Australia, two new satellite communications operations centres and an integrated central management system.

“This capability will provide the Australian Defence Force with robust connectivity and reliable information when and where they need it and, by extension, contribute further to the growth and development of Australia’s defence and space industries,” Warren McDonald, Chief Executive of Lockheed Martin Australia and New Zealand, said after winning the bid.

But the new statement said that, with the acceleration in space technologies and evolving threats in space since the project’s commencement, Defence has assessed that a single-orbit GEO-based satellite communications system would not meet its strategic priorities, and that a multi-orbit capability would better increase resilience for the Australian Defence Force. As such, Defence has decided to cease its current procurement activity with Lockheed Martin Australia for a single-orbit system.

The reason given for the cancellation has been called into question, with defence industry sources quoted by The Australian indicating that insufficient funding was allocated to start the program and that its initial budget was set to blow out. Furthermore, according to the ABC, defence industry figures believe there are cheaper options available.

In a statement, Shadow Minister for Defence Andrew Hastie described the cancellation as “disgraceful”.

“It appears that the program has been cancelled because Labor has not funded it in the Defence budget,” Hastie said.

“The cancellation of this project devastates our capabilities in strategic overwatch and our ability to coordinate our future defence force.

“Defence Minister Richard Marles must stand up today and clarify the status of JP9102 to the Australian people and defence industry.”

Marles did indeed address the issue in an interview on Tuesday, in which he insisted that the satellite program had not technically been “cancelled”.

“What we’ve done is made a decision to re-scope it; to take into account, really, developments in technology, so that we have a more distributed solution to future Defence communications which is more resilient, which does pick up the kind of technology that we are seeing being used around the world, particularly over Ukraine now,” Marles said.

“And in the process, we address the threats to technology where we do see capabilities which enable satellites to literally be shot out of the sky. In progressing this, we believe we can do this in a more resilient way, and therefore a more capable way, in a more timely way, and a more cost-effective way.”

A significant amount of the content for Lockheed Martin’s proposed JP9102 solution was set to be sourced from Australian small and medium enterprises. The company had also partnered with the Victorian Government to establish Victoria as the engineering and technical hub for the project, which would have created more than 200 advanced space industry jobs in the state.

Satellite image originally supplied by Lockheed Martin.