Europe Set to Award Contracts for Galileo System

The process of picking technology companies to build the satellites and ground stations for Europe's satellite navigation system will begin in the next two months, the European Commission said Tuesday.

Politicians gave their final assent to the Galileo satellite program Monday, after years of setbacks and delays threatened to derail the ambitious project, which is Europe's answer to U.S.-run GPS (Global Positioning System).

Billions of euros of contracts are to be awarded to Europe's aerospace and computer industries in time to allow them to complete construction of the 30-strong constellation of satellites and their network of installations on the ground by the 2013 deadline.

Front runners include the companies that abandoned the Galileo project in 2005. They include the European Aeronautic Defence and Space Company (EADS), France's Thales and Alcatel-Lucent , Britain's Inmarsat, Italy's Finmeccanica, Spain's AENA and Hispasat and Deutsche Telekom of Germany.

The companies pulled out because they feared losing money. The Commission stepped in and proposed allocating unused European Union funds, mostly budgeted for farm subsidies, to plug the shortfall in Galileo's estimated €3.4 billion (US$5.1 billion) budget.

The move effectively took the project out of the private sector and handed it to the E.U., but it doesn't appear to have deterred the companies from wanting to participate.

EADS is already gearing up to bid for work. It announced Tuesday that it is in negotiations to buy Surrey Satellite Technologies, a spin-off from Surrey University, which developed and launched the only Galileo satellite already in orbit.

Monday's political agreement gives the European Space Agency the authority to start a tender for contracts without delay. The process of awarding the contracts is due to finish by the end of next year.

The deal splits the work into six main segments and distributes tasks evenly among a few prime contractors and subcontractors.

Meanwhile, a Russian rocket will launch a second Galileo satellite on April 27, the European Commission said Tuesday. Galileo's first satellite was launched in 2005. However, the second satellite (Giove-B) was delayed for almost a year due to a short-circuit problem in final testing.