The grant is part of $370 million worth of contracts signed under NASA's "Tipping Point" selections, meant to advance research and development for space exploration.
"The system could support lunar surface communications at greater distances, increased speeds and provide more reliability than current standards," NASA noted in its contract award announcement.
According to United Press International, NASA Administrator Jim Bridenstine in a live broadcast said that the space agency must quickly develop new technologies for living and working on the moon if it wants to realise its goal to have astronauts working at a lunar base by 2028.
"We need power systems that can last a long time on the surface of the moon, and we need habitation capability on the surface," Bridenstine said.
Nokia's research arm, Bell Labs, provided more details in a Twitter thread. The company intends for the network to support wireless operation of lunar rovers and navigation, as well as streaming video.
"Working with our partners at @Int_Machines, this groundbreaking network will be the critical communications fabric for data transmission applications, including the control of lunar rovers, real-time navigation over lunar geography and streaming of high definition video," Bell Labs said in a tweet.
This is not Nokia's first attempt to launch an LTE network on the moon. It was planned to do this in 2018 in collaboration with PTScientists, a German space company, and Vodafone UK to launch an LTE network at the site of the Apollo 17 landing, but the mission never got off the ground.