U.S. plans new government-owned satellites

By Andrea Shalal-Esa

WASHINGTON (Reuters) - Defying congressional opposition, the U.S. government on Tuesday said it would buy expensive new spy satellites and order more imagery from two commercial providers to plug gaps in satellite coverage.

The plan, which analysts and former military officials estimate will cost around $10 billion, was announced by Dennis Blair, the retired Navy admiral who serves as President Barack Obama's Director of National Intelligence.

The program will replace one that was initially awarded to Boeing Co, but was partially canceled three years ago when its costs soared billions of dollars over budget.

Blair said satellite imagery was a core component of U.S. national security, and the new satellites were needed to ensure the safety of U.S. troops and citizens.

"Our proposal is an integrated, sustainable approach based on cost, feasibility and timeliness that meets the needs of our country now and puts in place a system to ensure that we will not have imagery gaps in the future," he said in a statement.

Obama approved the plan, endorsed by Blair and Defense Secretary Robert Gates, on Monday, according to the statement.

Years in the making, the plan has drawn fire from lawmakers furious about billions of dollars of cost overruns in the earlier Future Imagery Architecture satellite program.

Sen. Christopher Bond, the top Republican on the Senate Select Committee on Intelligence, told Blair in a letter dated March 16 that the plan had "zero" chance of delivering satellites on schedule and would cost too much.