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ndonesia is at risk of losing its right to a strategic orbital slot after an overseas satellite provider declared a dispute with the Defense Ministry following a missed payment.

United Kingdom-based Avanti Communications claims the ministry failed to pay US$16.8 million of a $30 million lease contract for an Artemis satellite, initially used by Indonesia to maintain its orbital slot at 123 degrees East longitude.

Avanti filed the complaint at the London Court of International Arbitration in August last year and the company subsequently retracted its satellite in November, leaving the orbital slot — which was allocated by the International Communication Union (ITU) to Indonesia via the Communication and Information Ministry — empty.

Communication Minister Rudiantara said leaving the slot empty put the country’s satellite allocation in the 123 orbital slot, which is reserved for the L-Band frequency, at risk. Due to lower frequencies, L-Band is suitable for military communications and navigation.

“If the occupancy is still uncertain, the slot can be taken by other operators […] there are those who have eyed the slot, including one [operator] from the UK and one from the Middle East,” he said.

The slot, located on the equator above Sulawesi Island, provided vast coverage for satellite communication in the L-band frequency as it reached remote areas across the country, he said.

Indonesia currently has seven orbital slots of various frequency bands that are used for various purposes, including earth monitoring.

The 123 slot was previously occupied by a Garuda-1 satellite operated by Asia Cellular Satellite, which was removed in 2015 due to malfunctions. According to ITU regulations, a country is given three years to install another satellite in the slot, or else it will be allocated to other country.

The Defense Ministry later decided to rent a floater satellite from Avanti to occupy the slot starting from November 2016, while Indonesia prepared to purchase another satellite, which needed three years to build.

But since the ministry did not make the payments from late 2016 to 2017, Avanti terminated the contract and retracted the satellite last November.

Indonesia had three years until November 2020 to occupy the slot with another satellite, or else the orbital slot would be taken by ITU and allocated to other countries, the director general of defense capacity at the ministry, Maj. Gen. Bambang Hartawan, said.

Defense Minister Ryamizard Ryacudu repeatedly said Indonesia should procure its own satellites so that it could control its own data and operations.

In 2016, the government and the House of Representatives agreed to acquire a communication satellite from Airbus Defense and Space for $669 million, which was expected to be launched in 2019 to the 123 orbital slot.

But Bambang said the project was suspended and therefore it was unclear whether the satellite would be launched as scheduled.

When asked whether the ministry would sign another lease contract to occupy the slot, Bambang said, “It is not easy to take out a lease since it is related to the availability of an L-band satellite, particularly the one that is ready to be rented.”

He admitted that there was a problem within the government, which hampered the payment to Avanti. He did not give reasons, but said the ministry was committed to making the payment.

The ministry will either have to do its best to win the arbitration case or go for a negotiated settlement with the satellite provider.