Under the $913.2 million Falcon Eye contract, the Emirates, a federation of seven gulf sheikhdoms, will receive a brace of Helios high-resolution satellites to be built by Astrium, the space division of the European aerospace defense giant European Aeronautics Defense and Space Co. and Thales Alenia Space, a joint venture between Thales of France and Finmeccanica of Italy.
Under an annex agreement, French military personnel will aid Emirati technicians in interpreting images and share information delivered by the satellites, said officials who accompanied French Defense Minister Jean-Yves Le Drian for the contract signing Monday.
The Emirates spearhead efforts by the Gulf Cooperation Council -- the other members are Saudi Arabia, Kuwait, Qatar, Oman and Bahrain -- to acquire a military surveillance satellite network to bolster an early warning system they've been talking about for a decade.
But, largely due to dynastic squabbles and mistrust within the GCC alliance established at the height of the 1980-88 war Iran-Iraq War, this and other GCC military aims remain unfulfilled.
However, growing tensions with Iran could spur them to set aside their differences.
In 2007, France and the Emirates signed a contract to develop communications satellites with Astrium and Thales Alenia Space. The Y1A, the first in the series, was launched in April 2011 from the European Space Center in French Guiana atop an Ariane 5 rocket.
The satellite, which, with the Y1B launched April 24 from the Baikonur Cosmodrome in Kazakhstan, would provide commercial communications across the Middle East, Africa, Southwest Asia and Europe, was based on Astrium's highly successful Eurostar E300 platform.
It was built by Yahsat, a wholly owned subsidiary of the Mubadala Development Co., which has headquarters in Abu Dhabi, the Emirates capital and the federation's oil-rich economic powerhouse.
Mubadala, the government's investment arm, is heavily involved in the Emirates' drive to develop an indigenous defense industry that's already becoming a regional leader. The federation has in recent years built up a powerful air force and air-defense system.
It signed a $4.3 billion deal in December 2011 for two batteries of Lockheed Martin's Terminal High Altitude Area Defense missile system, the U.S. system's first foreign sale.
In 2012, U.S. satellite builders like Lockheed Martin and the Raytheon Co. were reported to have convinced the U.S. administration to ease export rules so they could compete with European firms to sell spy satellites to the Emirates.
The Europeans edged out Lockheed Martin for this week's spy satellite contract. EADS and Thales Alenia Space of Cannes, France, were said to have had an edge because of their involvement in the $1.6 billion Yahsat program.
The Emirates has established itself as the space technology hub in the region and launched its first satellite, the 419-pound DubaiSat-1, in July 2009 from Baikonur.
On April 24, 2011, the Emirates launched its fifth communications satellite into orbit, the first to provide secure and independent telecommunications for its armed forces amid the gulf Arabs' drive to boost their military capabilities against Iran.
In April, Salem al Merri, assistant director of scientific affairs at the Emirates Institution for Advanced Science and Technology, announced that the organization planned to launch DubaiSat-2 this year.
He said the 726-pound DubaiSat-3, the first imaging satellite to be constructed in the Emirate, is scheduled for orbiting in 2017.
Initial development will take place in South Korea in collaboration with the Satrac Initiative, a solutions provider for Earth observation missions that was closely involved with the DubaiSat-1 and 2 programs.
DubaiSat-3 will be transferred to the Emirates Institution's satellite manufacturing facilities at Khawaneej in neighboring Dubai midway through the program, where it will be built by an all-Emirates team.
The institution Director General Yousuf al-Shaibani said a DubaiSat-4 project is already under discussion, stressing: "DubaiSat-3 is an important project as it tests our own satellite manufacturing capabilities and ultimately gives insights to further improve future satellite development programs."