Wednesday, April 02, 2008

RADARSAT-2: Sound and fury...

...signifying very little other than all-too-typical Canadian "nationalist" outrage over a defence-related issue with the evil Americans involved (, the preceding link, is a creature of the Rideau Institute--home of Steve Staples whom our media love to quote as a defence "expert" and who is actually a co-founder of Stories by David Pugliese of the Ottawa Citizen--here, here, here and here, with several other stories following--did much to stir up the needless outrage (a knee-jerk, pre-Pugliese, example is at this post). This in fact appears to be the non-outrageous reality:

Canada will retain total control over its Radarsat-2 surveillance satellite regardless of who owns it, says the head of the space company whose proposed sale to U.S. interests has raised concerns about national security.

Daniel Friedmann, president of MacDonald, Dettwiler and Associates (MDA), says fears that the sale of his company to a U.S. defence contractor will jeopardize Canadian sovereignty are unfounded because the satellite will continue to operate under Canada's rules.

"Canada's foreign affairs minister regulates everything about that satellite," he said yesterday. "The minister has shutter control."

Industry Minister Jim Prentice is reviewing the proposed $1.325-billion sale of MDA to Minnesota-based Alliant Techsystems (ATK) to ensure the deal is in Canada's interest.

MDA has been the primary technology supplier to Canadian Space Agency projects, representing about 50 per cent of the agency's total contracts, including development of the Cana-darm and the Dextre robot used on the International Space Station.

Critics say the sale to ATK will allow that company to take advantage of technology developed with heavy investment from Canadian taxpayers. Some have said the deal will have the same effect on Canada's space industry that the end of the Avro Arrow jet-fighter program in 1959 had on Canadian aerospace development.

The deal has also raised concerns about sovereignty, since Radarsat-2 was trumpeted by the Conservative government as key to continuing to assert Canada's control over the Arctic through remote surveillance.

However, Mr. Friedmann told a House of Commons industry committee yesterday that nothing other than the ownership of the company would change if the government approved the deal.

"The Canadian government is in control of what happens," Mr. Friedmann said.

Radarsat-2 is licensed to operate by the Canadian government, and ownership of the parent firm has no bearing on that relationship, he promised.

"As far as I can tell, it's a Canadian operation under Canadian law running a Canadian satellite," he told reporters later.

Operation of the satellite will remain with MDA's Canadian employees working from the Canadian Space Agency facility in St-Hubert, Que., he said.

Under ATK ownership, MDA would still be required to provide $445 million worth of remote sensing imagery from the satellite, he said. The firm will recoup its own $200-million investment in the Radarsat-2 by selling imagery to other clients, including the U.S. government.

Canada's export control laws would prevent a foreign owner from taking any of the equipment, software or technical documentation out of the country without the consent of the foreign minister.

He insisted the deal with ATK would strengthen Canada's space industry by giving MDA and its 1,500 employees better access to the U.S. market.

"The No. 1 reason we picked this option was to maintain the jobs in Canada," Mr. Friedmann said. " I have to participate in U.S. programs."

There were no issues about sovereignty or control over Radarsat-2 when the then-Liberal government contracted MDA to start building it in the late 1990s, he noted. Then, the company was 100-per-cent owned by a U.S. firm, Orbital...
Don Martin got his knickers tightly knotted two weeks ago in the National Post:

Time to ground space firm's sale
Purchase by U.S. interests good for shareholders, bad for Canadians
But on April 2 reality had him writing this:

...Despite sky-is-falling scenarios [like yours above, Mr Martin] from those who argue selling the government's partner in satellite and space robotic production to American interests puts our security and sovereignty at risk, nationalistic obstacles to the contentious deal are disappearing.

The Canadian Space Agency shrugged off sale concerns yesterday and the B.C.-based seller insisted nothing will change except, perhaps, having the Stars and Stripes plastered on its Canadarms, Dextre robot and that amazing Radarsat-2 satellite, developed with a $445-million data-collection contract from the federal government.

What emerged during industry committee hearings yesterday seems to validate a delay decision by Industry Minister Jim Prentice, who is now reviewing the $1.3-billion sale of MacDonald Dettwiler and Associates (MDA) of Richmond, B.C., to Alliant Techsystems of Minneapolis.

It gave MPs the chance to ask pointed questions and receive assurances that apparently nothing, nothing, NOTHING will change after the sale, according to MDA Corp. president Daniel Friedmann. Still, it's a tough sell.

The perception lingers that the Pentagon could be calling the shots, literally, for a Canadian-built and licensed satellite flying overhead every 100 minutes...

That perception was of course created largely by our media for their sensationalist purposes--and they are still regurgitating from the mouth of Steve, never mentioning his ties to the relentlessly anti-American and polemical (once again, look at this page to see who supports it):

Steven Staples of the Rideau Institute, a left-leaning public-policy group, says Mr. Friedmann's assertions that Canada will retain "shutter control" run contrary to a legal opinion obtained by his organization.

"You can't have two legal regimes apply to the same satellite," he said.

"Once this system is sold to ATK, which falls under the jurisdiction of the U.S. government, U.S. legal regimes apply."

Radarsat-2 and ATK will need a licence to operate from the U.S. government, Mr. Staples believes.

That raises the possibility that, if Canada wants a satellite image of a U.S. vessel moving through the Northwest Passage, for instance, the U.S. government could block MDA from providing it, he said...
Much more on RADARSAT-2 itself here.

Update: By the way, for all those who raise woeful comparisons between the Avro Arrow and Radarsat-2 (Prof. Michael Byers, St. Steve's evil twin, amongst them), just remember that A.V. Roe Canada was foreign-owned, by the British Hawker Siddeley Group. Foreign ownership had nothing to do with the end of the Arrow or its Canadian manufacturer. The Canadian government ended the program, for good financial and military policy reasons.

In the case of Radarsat-2 ownership of the manufacturing capability may transfer to a foreign company but at least the capability should continue in Canada, and with a better shot of keeping going by getting US government business--the rationale for the sale in the first place. The Canadian radar satellite market just ain't that great.

Upperdate: Mr Staples responds in the "Comments".

Uppestdate: More here. Note that RADARSAT-2 has only an expected seven-year life span, so it will cease operating before there is likely to be any significant maritime traffic in the Arctic that might raise sovereignty concerns for Canada. If Canadians want control of any further such satellites there is a simple answer: have the government buy MDA's space operations. And see how effectively and efficiently it can run things (there would seem to be no private Canadian interest in the radar satellite business). Simply preventing the current sale will do nothing to make the business commecially viable in the future for MDA--unless, instead of an actual government purchase, there are continuous and probably large government subsidies.


Blogger Babbling Brooks said...

Given strange statutes like the Helms-Burton Act, which allows the U.S. to exert all sorts of inappropriate control over foreign subsidiaries of U.S. firms, and even non-U.S. firms, I'm not sure if the buying company's assurances are to be taken at face value. Heck, look at the conflicts Canadian companies have had with ITAR, for another example.

I can't believe I'm about to say this, but Staples et al may be correct in this one specific instance.

5:02 p.m., April 02, 2008  
Blogger Minicapt said...

Given the other details in the article, Mr Staples may have a valid legal opinion on the satellite's status, but I really don't think those details are quite correct. For one things, I doubt Mr Staples has a useful security clearance.


3:49 a.m., April 03, 2008  
Blogger Steven Staples, Rideau Institute said...

We are arguing that Canada needs this satellite for national security reasons (see our legal opinion on All concerned about our national security and the safety of CF personnel should put aside their differences and oppose this deal.

Col. Pierre Leblanc (ret.) (former commander of Canadian Forces Northern Area)
(CTV Question Period)
March 23, 2008
"The Prime Minister talks about sovereignty - use it or lose it. And yet we have a tool that is excellent for Arctic surveillance, monitoring of our internal waters that are contested by the Americans and other countries, and now we're going to sell this asset to an American company."

Prof. Rob Huebert (Center for Military and Strategic Studies, Univ. of Calgary)
(Globe and Mail)
March 24, 2008
"We've never thought strategically and it just astonishes me that we're probably the only country that we know of with this type of technology, and we [don't] understand its significance,"

Calgary Herald
Tuesday, March 25, 2008
“It is wholly Canadian technology, for which there is no substitute elsewhere. Given Canada's surveillance needs, this alone would justify every cent Canadians have invested in MDA.”

Steve Staples
613 565-9449

9:18 a.m., April 03, 2008  
Blogger Minicapt said...

Given the three quotes produced by Mr Staples, it would appear he has not talked with anyone who has informed knowledge of RadarSat.


7:27 p.m., April 04, 2008  
Blogger Brian said...

While Terence Corcoran's article gave a good historical perspective of the MDA satellite "deal" struck with the Liberal government at the time , it omitted the security aspect , which was yet another Liberal screwup with Washington.

Chretien and Martin did a fine job of ensuring poor relations with the US on military and security issues. As a result of 9/11 the US does not allow foreign companies to bid on classified military/security contracts. If the Liberals had not been so anti-US Canada might have received an exemption and been allowed to bid on classified projects , but such was not the case.

So now Harper has a no win situation.

My personal guess is that taxpayer dollars will flow into MDA until such time as the satellite fails , and then it will be "end of story" , and more money wasted.

Apparently MDA was "betting the farm" on being able to provide satellite surveillance data to the US , but as a result of 9/11 and Liberal anti-US bias , and a Liberal disdain for the military , and some "made-in-Canada" security screwups , Washington decided Canadians were a poor security risk , so now MDA is without a paying customer.

In retrospect MDA should have gone to bed with France ! It is really ironic , because the Liberals were always hyping trade with France.

My guess is that for a lot less than $485M , DND could have had access to France's SPOT (2.5m) surveillance satellite data , which anyone with the cash can access.

7:03 p.m., April 13, 2008  

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