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French-UAE Intel Satellite Deal in Doubt

Discovery of US Parts Raises Security Concerns

Jan. 5, 2014 - 03:45AM   |  
By AWAD MUSTAFA and PIERRE TRAN   |   Comments
The United Arab Emirates, which has purchased two Falcon Eye spy satellites based on the French Pleiades satellite, says the satellites contain parts made in the US that are considered 'security compromising components.'
The United Arab Emirates, which has purchased two Falcon Eye spy satellites based on the French Pleiades satellite, says the satellites contain parts made in the US that are considered 'security compromising components.' (Airbus Defence and Space)
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DUBAI AND PARIS — A United Arab Emirates (UAE) deal to purchase two intelligence satellites from France worth almost 3.4 billion dirhams (US $930 million) is in jeopardy after the discovery of what was described as “security compromising components.”

A high-level UAE source said the two high-resolution Pleiades-type Falcon Eye military observation satellites contained two specific US-supplied components that provide a back door to the highly secure data transmitted to the ground station.

“The discovery was reported to the deputy supreme commander’s office [Sheikh Mohammed Bin Zayed] in September,” the source said. “We have requested the French to change these components and also consulted with the Russian and Chinese firms.”

The source would not elaborate on what role the Russians or Chinese could play in future negotiations.

According to the deal — signed July 22 by Sheikh Mohammed, Crown Prince of Abu Dhabi and deputy supreme commander of the armed forces, and French Defense Minister Jean-Yves Le Drian — delivery was set for 2018, along with a ground station.

The satellites are provided by prime contractor Airbus Defence and Space and payload-maker Thales Alenia Space. Neither company was available for comment.

Twenty engineers will be trained to use the new equipment.

According to the UAE source, the discovery prompted increased talks between the UAE and Russia and a number of high-level delegations have shuttled between Moscow and Abu Dhabi.

“If this issue is not resolved, the UAE is willing to scrap the whole deal,” he added.

The UAE has drawn on Russian technology, with the GLONASS space-based navigation system fitted as a redundancy feature on a Western European weapon system, a French defense expert said.

The competition for the deal has been ongoing for more than a decade, and UAE officials in late 2012 said they had narrowed the Falcon Eye competition from 11 bidders and their backing governments to proposals from US and French teams.

The UAE source said the French team won the bid due to the US State Department’s restrictions on the use of the system, often referred to as “shutter control.”

In Paris, one defense specialist found it intriguing that France had drawn on US technology for the satellites under the Falcon Eye program.

“That is surprising,” the specialist said.

France operates the Pleiades spy satellite in what is viewed as a critical piece of the nation’s sovereignty. Given that core competence, it seemed strange that France would use US technology, although there is an agreement between Paris and Washington over transfer of capabilities, analysts said.

Or, Abu Dhabi’s questioning of the satellite deal could be a way of putting pressure on Paris to get a better offer for the Dassault Aviation Rafale fighter.

“The satellites would be part of a big package deal,” the defense specialist in Paris said. “It’s not surprising. The UAE drives a hard bargain. They’re using it as a lever of power.”

A second defense specialist said it was possible French industry had drawn on the US.

“The payload is complex, not all the technology is French,” the second specialist said.

The French negotiations with the US on the technology for the UAE would have been sensitive. For example, when the US sold spy satellites to Saudi Arabia, Israel wanted to limit the resolution level in the payload, the second specialist said.

For the French satellites sold to the UAE, a very high optical resolution and encrypted code could be used to guide a cruise missile to a target in Iran, the second specialist said.

It is not clear whether the critical components can be replaced, the specialist said.

The way ahead may be to find a formula, a compromise which allows the UAE to say it was firm on technology demands, while accepting US gear on a French system — perhaps through the British, the specialist said.

Generally, Arabian Gulf countries split arms buys to reduce dependence on the US, the specialist said. The UAE flies the Lockheed Martin F-16 and Dassault Mirage 2000-9, while the Saudis operate the Boeing F-15, as well as the Tornado and Typhoon.

But the ultimate guarantor for security in the region is the US, the second specialist said.

Under wide French press coverage of the Falcon Eye deal, La Tribune noted the “colossal work” of the Direction Générale de l’Armament procurement office and help from the French Embassy.

The DGA and the embassy declined comment.

Airbus Defence and Space will build the Astrobus-based platform, while Thales Alenia Space will deliver the payload. The latter is a Franco-Italian joint venture majority-owned by the French partner.

Thales Alenia Space CEO Jean-Louis Galle said the company delivers the “operational intelligence capability,” daily Le Figaro reported in July.

François Auque, head of Space Systems for Airbus Defence and Space, said France has never agreed before the UAE deal to sell such high-resolution optics in a military satellite to a foreign country, Le Figaro reported.

The UAE has previously asked for a high level of technology access. In the 1990s, when Abu Dhabi bought the F-16 E/F Block 60, authorities asked for the source code as the UAE co-developed and co-owned the Desert Falcon fighter. The UAE invested a reported $3 billion in the total $7.3 billion acquisition.

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