BEDMINSTER, NJ - September 12, 2005 - Loral Skynet today announced that it has reached an agreement with Telekom Austria that completes the full initial infrastructure rollout of its SkyReach IP-enabled communications services. In accordance with the agreement, Loral Skynet will install an iDirect IP hub at Telekom Austria's state-of-the-art Aflenz teleport, expanding SkyReach's coverage area across Europe, the Middle East and Africa. SkyReach customers across the region will have access to regional and global private networking and public Internet services, including broadband WAN extension for terrestrial providers, Internet access for ISPs, voice over IP (VoIP) and managed data services.

"The now global reach of this powerful and cost-effective technology firmly establishes Loral Skynet as a leader in IP-based integrated satellite and terrestrial communications services," said Bernard L. Schwartz, chairman and CEO of Loral. "Today's satellite communications companies need to offer much more than just standard bandwidth-only services. They also must provide the latest integrated platform services to deliver complete solutions to enterprise and government customers. Since it pioneered IP services over satellite nearly 15 years ago, Loral Skynet has maintained its leadership role not just in the satellite sector, but in the entire communications industry."

Loral Skynet's new European-based SkyReach hub will allow for multiple points of connectivity through satellites spanning from Europe to Asia and through terrestrial facilities. Skynet will combine satellite capacity on its own Telstar 12 and Telstar 10 satellites, with other regional satellites to establish a robust, far-reaching IP-based network. SkyReach's service in Europe is available today using other teleport facility partnerships. Full service on Skynet's hub at Telekom Austria's Aflenz teleport will be available by December 2005.

SkyReach uses VSAT technology to deliver a full range of IP applications, including Internet access, Voice over IP (VoIP), streamed media, file transfers (FTP), Virtual Private Networks (VPN), LAN connectivity and satellite-enabled WiFi services. SkyReach services complement existing frame relay and MPLS networks and enable efficient network management.

Through SkyReach, and coupled with its worldwide infrastructure and installation Ground Operator (GO) partners, Loral Skynet is one of the only satellite services company in the world that can extend, install and maintain satellite-delivered IP connectivity on a truly seamless and global basis. With its tiered SLAs (service level agreements) and quality-of-service features, SkyReach enables a natural extension of terrestrial MPLS systems and a platform for multicast and broadcast video requirements. Loral Skynet provides its SkyReach global IP service through hubs at facilities in North America, Europe and Asia, each with access to major satellite and terrestrial communications networks.

A pioneer in the satellite industry, Loral Skynet delivers the superior service quality and range of satellite solutions that have made it an industry leader for more than 40 years. Through the broad coverage of the Telstar satellite fleet, in combination with its hybrid VSAT/fiber global network infrastructure, Skynet meets the needs of companies around the world for broadcast and data network services, Internet access, IP and systems integration. Headquartered in Bedminster, New Jersey, Loral Skynet is dedicated to providing secure, high-quality connectivity and communications. For more information, visit the Loral Skynet web site at www.loralskynet.com.

In addition to being the parent company of Loral Skynet, Loral Space & Communications is a world-class leader in the design and manufacture of satellites and satellite systems for commercial and government applications through its Space Systems / Loral subsidiary.

This document contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In addition, Loral Space & Communications Ltd. or its representatives have made or may make forward-looking statements, orally or in writing, which may be included in, but are not limited to, various filings made by the company with the Securities and Exchange Commission, press releases or oral statements made with the approval of an authorized executive officer of the company. Actual results could differ materially from those projected or suggested in any forward-looking statements as a result of a wide variety of factors and conditions. These factors include those related to the filing, on July 15, 2003 by Loral and certain of its subsidiaries, of voluntary petitions for reorganization under chapter 11 of title 11 of the United States Code in the United States District Court for the Southern District of New York and parallel insolvency proceedings in the Supreme Court of Bermuda in which certain partners of KPMG were appointed as joint provisional liquidators. Additional factors and conditions are also described in the section of the company's annual report on Form 10-K for the fiscal year ended December 31, 2004, entitled "Commitments and Contingencies," and the company's other filings with the Securities and Exchange Commission. The reader is specifically referred to these documents.