Pentagon sees expanding use of satellite imagery

By Andrea Shalal-Esa

WASHINGTON, Oct 1 (Reuters) - The Pentagon gets a "huge chunk" of satellite imagery from commercial providers and will continue to invest heavily in the industry, the head of the National Geospatial-Intelligence Agency said on Wednesday.

Vice Adm. Robert Murrett, director of the military agency that collects and analyzes satellite imagery, told a group of defense reporters that commercial imagery would become even more important after the launch of several new satellites.

He downplayed concerns that the government's recent decision to buy and operate its own commercial-grade imagery satellites could cut into the industry's government sales.

"We are the single strongest supporter of the commercial remote sensing industry. It is absolutely integral to our success and is a fundamental building block for what we do as an agency," he said.

"The point that people need to not lose sight of is what a huge chunk of our mission capability is comprised by the commercial remote sensing industry, and how we have programmed for and embedded it in our architecture in ways that are irreversible for many, many years into the future," he added.

Murrett said the money invested by NGA in the commercial sector were "absolutely overwhelming and that will continue to be the case."

NGA spokesman Marshall Hudson declined to say what percentage of NGA imagery came from the commercial sector, but said it amounted to about 122 million square kilometers each year. The total could "potentially double" when a new satellite launched by GeoEye Inc (GEOY.O) came on line, he said.

The U.S. military and intelligence community last month agreed to buy and jointly run two commercial-grade imagery satellites with an aperture of 1.1 meters about four years from now, at a cost of about $1.7 billion.

The Broad Area Space-based Imagery Collector program has been criticized by some because it essentially duplicates capability already available from commercial providers.

But defense officials said the government wants to buy its own satellites to have greater control over when, and what, imagery is collected. The new satellites would also offer better integration with other defense systems, they argue.

Murrett said he hoped the Pentagon would be ready to issue a formal request for proposals for the new satellites soon.

In response to congressional funding cuts, the National Reconnaissance Office, which will run the program, is currently working on "an additional review of the various options" so it can provide lawmakers with more information, said one defense official, who asked not to be named.

Murrett said initial tests of GeoEye 1, a new high-resolution satellite launched by GeoEye Inc last month that was half-funded by NGA, were going well. He said he looked forward to receiving imagery from the satellite soon.

"We continue to make progress in testing all the components of the new satellite and expect to have imagery for our customers later this month," said GeoEye spokesman Mark Brender.

DigitalGlobe (DGI.N), the other commercial provider funded by NGA under its NextView contract, launched its Worldview-1 satellite last September, and plans to launch a second high-resolution satellite in mid-2009.

Both companies are due to provide imagery to the government from the new satellites, but also may sell it to commercial and non-government users. (Reporting by Andrea Shalal-Esa; editing by Carol Bishopric)