Loral Skynet, a subsidiary of Loral Space & Communications, today said that it has been unable to re-establish contact with its Telstar 4 satellite and has declared the satellite a total loss. As previously reported, Telstar 4 experienced a short circuit of its primary power bus on September 19, 2003.

At the time of the satellite's failure, Loral Skynet initiated a comprehensive restoration plan that has provided capacity to nearly all Telstar 4 customers on Loral's Telstar 5, Telstar 6 and Telstar 7 satellites. Loral Skynet and Lockheed Martin, the manufacturer of the satellite, continue to work to identify the cause of the problem.

The satellite was insured for $141 million. Under Loral's agreement to sell its six North American satellites to Intelsat, the purchase price will be reduced by any insurance proceeds received by Loral. Loral continues to expect to complete the sale in a timely manner.

As previously planned, Loral will replace Telstar 4 at 89 degrees West in mid-2004 with the larger and more powerful Telstar 8 satellite, currently under construction at Space Systems/Loral. Telstar 8 carries a Ka-band payload, in addition to C- and Ku-band.

Telstar 4 covered the continental U.S., Alaska, Hawaii, Puerto Rico, U.S. Virgin Islands, and southern Canada. Telstar 4 was launched in September 1995.

Loral Space & Communications is a satellite communications company. It owns and operates a global fleet of telecommunications satellites used by television and cable networks to broadcast video entertainment programming, and by communication service providers, resellers, corporate and government customers for broadband data transmission, Internet services and other value-added communications services. Loral also is a world-class leader in the design and manufacture of satellites and satellite systems for commercial and government applications including direct-to-home television, broadband communications, wireless telephony, weather monitoring and air traffic management.