The $2.3B contract will add 69 satellites to Telesat's Lightspeed network, with additional work for MDA and a potential $2.7B total value. A next phase for a MEO constellation is under negotiation.
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The federal government's Defence Investment Agency awarded a $2.3-billion CAD contract to Telesat on Tuesday morning, the largest in the Ottawa-based company's history. Telesat will build a satellite network for the Canadian Armed Forces in the Arctic, with MDA Space of Brampton, Ontario, manufacturing the spacecraft.
The contract adds 69 satellites to Telesat's Lightspeed low-Earth orbit constellation, lifting the total from 156 to 225. The additional work increases MDA Space's contract value by $474 million. The base 15-year agreement includes two five-year options worth about $200 million each, bringing the total potential value to $2.7 billion.
The constellation will provide the Canadian Armed Forces with secure satellite communications in the Arctic, supporting regional defence and search-and-rescue missions. The government described the project as part of Canada's Arctic sovereignty push.
"Secure, sovereign communications are essential to the Canadian Armed Forces' ability to operate across Canada's North, work seamlessly with our allies and partners, and contribute to continental defence," Royal Canadian Air Force commander Jamie Speiser-Blanchet said in a statement.
The contract builds on an initial award in December for engineering work on the Enhanced Satellite Communications Project – Polar. The end-to-end network integration, including ground infrastructure, training, and support services, will be covered under a separate agreement with the DIA, Telesat said.
The satellites will be assembled at MDA's expanded Montreal manufacturing facility, which was recently enlarged to handle growing demand for satellite constellations.
The deal secures a long-term anchor customer for Telesat's Lightspeed network, which the company has been financing and developing as a commercial LEO constellation. The government contract provides a steady revenue stream over 15 years, with optional extensions that could push the program into 2040.
For MDA Space, the contract deepens its satellite manufacturing backlog and reinforces its role as a key supplier for sovereign space programs. The company's Montreal plant is now dedicated to building the Lightspeed satellites, with the additional 69 units extending the production schedule.
A next phase of the program is already taking shape. MDA has been named prime contractor for a secure medium-Earth orbit constellation that will use ultra-high frequency and X-band bands. Telesat will serve as subcontractor, integrating systems and implementing the communication bands. The contract details remain under negotiation, according to MDA and the DIA.
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