Optus will lengthen the life of its C1 satellite by reducing its fuel useage as part of a contract extension with the Department of Defence.
The satellite was expected to reach end-of-life in 2020. Optus will now continuing operating the satellite to 2027.
The total cost of the contract will be $40 million over the next decade, the government said.
Defence in 2014 announced it would extend its contract with Optus.
C1 was launched in June 2003 and has separate payloads for Defence and Optus' commercial customers. C1 provides Defence with communications in the X, Ka and UHF radio frequency bands.
“The extended use of Optus C1 will preserve Australia’s orbital filing precedence and options to place future satellite communications capabilities within the region,” defence minister Senator Marise Payne said.
“The agreement assists Defence and the government to preserve Australia’s right to continue to operate in the radio-frequency spectrum from space until such a time as Government elects an alternative course of action,” the minister said.