Department of National Defence

Department of National Defence

January 17, 2012 12:26 ET

Ministers MacKay and Fantino Announce Canada's Commitment to the Wideband Global Satellite Communications System

OTTAWA, ONTARIO--(Marketwire - Jan. 17, 2012) - The Honourable Peter MacKay, Minister of National Defence, and the Honourable Julian Fantino, Associate Minister of National Defence, today announced the signing of a Memorandum of Understanding that will fill the strategic satellite communications requirements of the Canadian Forces over the next 20 years.

"The Canadian Forces' recent efforts in Libya and Afghanistan have highlighted the critical importance of rapid communications between headquarters and deployed forces," said Minister MacKay. "This agreement with our allies will meet the requirement for secure data and voice transmissions, which are essential to the success of modern military operations."

By signing on to the Wideband Global Satellite Communications System, Canada joins Australia, Denmark, Luxembourg, the Netherlands, New Zealand, and the U.S., in a global satellite system that will provide each nation with guaranteed access to independent communications channels drawn from frequencies that are internationally regulated for government use. Under the Memorandum of Understanding, Canada will provide a one-time fixed payment toward the construction of a ninth Wideband Global Satellite (WGS) in exchange for immediate and future access to the system.

"Our Government is demonstrating its commitment to providing our Canadian Forces with the modern capabilities that ensure our brave men and women the best probability of mission success," said Minister Fantino. "Canada is pleased to participate in this international partnership that is critical to the success of future Canadian Forces missions."

"In addition to bringing long-term benefits to the Canadian Forces, this investment brings economic benefits to Canada and, in particular, Canada's space industries," said the Honourable Christian Paradis, Minister of Industry. "Thanks to Canada's Industrial and Regional Benefits Policy, this project will translate into new work for Canadian firms."

The Boeing Company, the builder of the satellites for the Wideband Global system, will have an Industrial and Regional Benefits (IRB) obligation to place high-quality business activity with Canadian industry, equivalent to 100 percent of Boeing's share of Canada's contribution to the WGS system. As a third party to the Memorandum of Understanding between Canada and the United States Government, Boeing's IRB obligation for the Mercury Global project is $240 million. The balance of $100 million includes $39.3 million for operations and service costs over 20 years, as well as other costs associated with supporting the program that will not be paid to Boeing. As such, the $100 million balance invested as part of the MOU will not have applicable IRBs, as the policy is only applied to companies.

This agreement adds to the 63 existing major procurements subject to the IRB policy which currently represents over $22 billion in IRB commitments from major defence and security contractors.

For more information on Canada's participation in the Wideband Global Satellite Communications system, please refer to the following backgrounder:

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