HUGHES SPACE AND COMMUNICATIONS INTERNATIONAL, INC.
HUGHES SPACE AND COMMUNICATIONS COMPANY
Communications and Customer Relations
P.O. Box 92919 (S10/S323)
Los Angeles, CA 90009
(310) 364-6363
www.hughespace.com

HSC Logo
THURAYA SATELLITE TELECOMMUNICATIONS CO.
P.O. Box 33344
Abu Dhabi, United Arab Emirates
Ph. (971-2) 208 4207, Fax (971-2) 330 064
Email: thuraya@emirates.net.ae
www.thuraya.com


HUGHES TO BUILD THURAYA SATELLITE PHONE SYSTEM FOR MIDEAST (photo)

ABU DHABI, United Arab Emirates, Sept. 11, 1997 -- Thuraya Satellite Telecommunications Company and Hughes Space and Communications International, Inc., (HSCI) signed a contract here today for a satellite-based mobile phone system to serve the Middle East, North Africa, Eastern Europe including Turkey, Central Asia and the Indian subcontinent.

Thuraya and Hughes concluded two weeks of final negotiations with a signing ceremony today in Abu Dhabi, UAE. Mohammad Hassan Omran, chairman of Thuraya, and Michael J. Houterman, HSCI president, signed on behalf of their companies. The ceremony, which was held at the ETISALAT Head Office in Abu Dhabi, was also attended by Thuraya's project manager, Yousuf Al Sayed, and marketing manager, Jamal Al Jarwan, along with senior executives of Thuraya, HSCI and a number of invited guests.

This will be the largest satellite communications project in the region, with an estimated total cost of $1 billion and a coverage area encompassing nearly 1.8 billion people. The project cost includes manufacture of two high-power satellites, launch services for the first satellite, insurance, ground facilities and a quarter of a million handheld telephones.

Hughes, of Los Angeles, will provide Thuraya a turnkey system with two GEO-Mobile body-stabilized satellites, ground facilities and mobile telephones. Thuraya, a privately held company owned by prominent organizations from the region, will select the launch vehicle later.

Hughes will deliver the first satellite in 31 months, enabling Thuraya to begin operations in the year 2000. The second spacecraft will be a ground spare, to be launched at a later date. The contract also has a provision for a third satellite to be ordered when needed. The satellite will operate in geostationary orbit, transmitting and receiving calls through a single 12.25-meter-aperture reflector. On-board digital signal processing will route the calls directly from one handheld unit to another, or to a terrestrial network.

Omran stated, "Today we have successfully concluded the final contract agreement with Hughes to develop, construct and operate the Thuraya Mobile Satellite System."

Omran added: "Today is considered the beginning for Thuraya's journey to orbit. The Thuraya satellite is scheduled for launch in May 2000 and will operate commercially by September 2000. Thuraya's business objective is to extend mobile coverage and service to users from the Indian subcontinent, crossing Central Asia, the Middle East, Eastern Europe including Turkey, to North Africa."

"Thuraya will enable business people to stay in touch while traveling in this region, as well as extend the most modern services to areas that lack telephones now," said HSCI's Houterman. "This project also establishes Hughes as not only the world's leading supplier of satellites, but also of entire space-based communications systems."

The Thuraya system will offer GSM-compatible mobile telephone services in the region. The satellites will employ advanced digital processing to create a very large number of spot beams that can be redirected wherever needed, even after the satellite is placed in orbit, from big cities to rural areas and even at sea.

Thuraya will work very closely in the forthcoming period with service providers in the coverage area to build up service agreements.

The Thuraya board of directors extends special thanks to the Thuraya Project Team, staff of Emirates Telecommunications Corporation ETISALAT and the Arabsat legal and technical team who have contributed greatly in the negotiation process.

Thuraya Satellite Communications Company is a private joint stock company owned by the following prominent organizations:


HSCI's team includes Hughes Network Systems and Hughes Information Technology Systems. The three companies are all units of Hughes Electronics Corporation. The earnings of Hughes Electronics are used to calculate the earnings per share attributable to GMH (NYSE symbol) common stock.

Thuraya is the first satellite project in the Middle East for Hughes, which was supported by the U.S. government in its bid. U.S. Secretary of Commerce, William Daley, added that "We are pleased that Thuraya has chosen an American firm for this important project. State-of-the-art technology from U.S. firms like Hughes can provide telecom services to people in many countries while supporting jobs here in the U.S. We are happy to have played a role in Hughes' success."

This marks the fifth satellite contract for Hughes this year, bringing its backlog to 41 spacecraft to be delivered by the end of 2000. The satellites are being built at Hughes Space and Communications Company's Integrated Satellite Factory near Los Angeles International Airport.

###