Satellite communications outfit NewSat has defaulted on a multi-million dollar contract with US aerospace company Lockheed Martin to build a commercial satellite.

NewSat, which delivers internet, voice, data and video communications using teleport infrastructure at Mawson Lakes and in Perth, has told the Australian Stock Exchange the situation arose from delays surrounding “an alleged technical breach of its Jabiru-1 satellite project financing facilities” that threatened to delay the project launch.

“Given the delays in the recommencement of debt funding, payments to Lockheed Martin have become overdue,” the company said in a statement.

“This has caused Lockheed Martin to give notice that NewSat is in default of the contract for the construction of the Jabiru-1 satellite in respect of overdue payments of US$21 million and issued a termination notice to NewSat in respect of such contract.”

Lockheed Martin’s website details that it is “utilising its A2100 satellite bus to create a new generation of commercial satellite” for NewSat.

“Jabiru-1 is currently being constructed in the US by Lockheed Martin at an estimated cost of US$650m, and will have a life span of 15 years,” it says.

NewSat believes Lockheed Martin “is continuing with construction of the satellite at this time”, and says both parties and lenders are “meeting regularly with a view to remedy the default, agree the terms on which debt funding could recommence and resolve all outstanding issues”.

The company’s first satellite, Jabiru-2, took flight last September after a five-month delay.