The GAO said the piece of cloth might have inadvertently been left in the fuel line during the manufacturing process. In a company statement, Lockheed Martin, the satellite’s manufacturer, confirmed that its laboratory tests indicated the most likely cause of the problem was foreign debris introduced during manufacture.

   The AEHF satellite is expected to reach its intended altitude in October 2011 – almost a year behind schedule. The new system is designed to increase military communications capacity from the Pentagon’s current Milstar system.

   “The total cost of the AEHF satellite system is $12.9 billion, but the satellite incurred $250 million in extra costs and a two-year delay because of quality problems with parts, including defective electronics in a power system,” the GAO said.

   The Air Force said Lockheed Martin’s AEHF contract is valued at $7.8 billion and that the company’s remaining award fee would be reduced by $15 million because of the fuel line problem.