The U.S. Space Force designated United Launch Alliance and SpaceX as the winners of a multibillion-dollar competition for national security launches over a five-year period, passing up a proposal from Amazon CEO Jeff Bezos’ Blue Origin space venture in the process.

Northrop Grumman and its OmegA rocket also lost out in the Phase II competition for the National Security Space Launch program.

ULA will receive a 60% share of the launch manifest for contracts awarded in the 2020-2024 time frame, with the first missions launching in fiscal 2022, said William Roper, assistant secretary of the Air Force for acquisition, technology and logistics. SpaceX will receive the other 40%.

The competition extended through the creation of the U.S. Space Force, whose Space and Missile Systems Center will be in charge of executing the launches in partnership with the National Reconnaissance Office.

The five-year Phase II program provides for fixed-price but indefinite-delivery contracts, which means there isn’t a specified total payout. But Roper said it’d be reasonable to estimate that somewhere around 32 to 34 launches would be covered, which would translate to billions of dollars in business.

Three launches were assigned today: ULA is scheduled to launch two missions known as USSF-51 and USSF-106 for the Space Force in 2022, while SpaceX has been assigned USSF-67 in mid-2022.

ULA’s two contracts amount to $337 million, and SpaceX’s contract is worth $316 million. Roper said details about the payloads are classified.

It’ll be up to the companies to determine the appropriate launch vehicles for those launches. ULA is likely to go with its next-generation Vulcan rocket. Depending on the heft of the payload, SpaceX could choose its Falcon 9 or Falcon Heavy rocket.

Roper said the winners and the also-rans were informed of the decision just before he began today’s Zoom teleconference with journalists. “They’ve had an hour to digest this,” he said.

The competition hasn’t been free of controversy: SpaceX protested being left out during a preliminary round of development contracts, while Blue Origin protested the Air Force’s plan to reduce the field to just two awardees.

Roper said the Air Force and consultants at the Rand Corp. determined that the market for national security launches wouldn’t support more than two launch providers in the 2020s. But he said Rand’s consultants noted that providing some support for a third company would help “discourage foreign entrants” in the U.S. launch industry.

To address that issue, Roper said he and other Pentagon were talking with members of Congress about starting the process for a Phase III launch services program earlier if funds become available. That could give Blue Origin and Northrop Grumman something new to shoot for.

Back in 2018, the Air Force set aside up to $2.26 billion in development funds for ULA, Blue Origin and Northrop Grumman leading up to the Phase II decision, with up to $500 million earmarked for Blue Origin. But in light of today’s announcement, Roper said the Air Force would work with Blue Origin and Northrop Grumman to “tie off” those development contracts as soon as appropriate.

Blue Origin can take some consolation in the fact that it’s due to provide the BE-4 rocket engines for ULA’s Vulcan rocket. The launch competition had its roots in a congressional mandate to stop buying Russian-made RD-180 rocket engines by 2022, and the BE-4 engines are meant to replace the RD-180s currently used on ULA’s workhorse Atlas 5 rocket.

ULA’s Vulcan and Blue Origin’s New Glenn orbital-class rocket are both due to start flying next year. And even if the Vulcan rocket’s debut ends up being delayed, Roper said there are a dozen spare RD-180s sitting around that could help ULA fill the gap with the Atlas 5.

“I am very confident with the selection that we have made today, that we have a very low-risk path to get off the RD-180 engines on time and not have to dip into that surplus that we have available — though we’re glad to know it’s there should we need it,” Roper said.

We’ve reached out to all four of the companies involved in the Phase II competition for comment. In a news release, United Launch Alliance CEO Tory Bruno said his company was “honored to be selected as one of two launch providers in this procurement.”

“Our Atlas and Delta rockets have been the backbone of American space launch for decades, and with Vulcan Centaur we continue to build on this progressive history of technology and advancement,” Bruno said.

Northrop Grumman said it was disappointed by the decision.

“We are confident we submitted a strong proposal that reflected our extensive space launch experience and provided value to our customer, and we are looking forward to our debriefing from the customer,” the company said in an emailed statement.

Blue Origin also expressed disappointment in an emailed statement:

“We are disappointed in the decision that New Glenn was not selected for the National Security Space Launch (NSSL) Phase 2 Launch Services Procurement (LSP). We submitted an incredibly compelling offer for the national security community and the U.S. taxpayer. Blue Origin’s offer was based on New Glenn’s heavy-lift performance, unprecedented private investment of more than $2.5 billion, and a very competitive single basic launch service price for any mission across the entire ordering period. We are proceeding with New Glenn development to fulfill our current commercial contracts, pursue a large and growing commercial market, and enter into new civil space launch contracts. We remain confident New Glenn will play a critical role for the national security community in the future due to the increasing realization that space is a contested domain and a robust, responsive, and resilient launch capability is ever more vital to U.S security.

“Blue Origin is very proud that our BE-4 engine will power United Launch Alliance’s Vulcan launch vehicle in support of the Space Force’s NSSL program and end reliance on Russian-built engines. The BE-4 is the most powerful liquefied natural gas-fueled rocket engine ever developed and the first oxygen-rich staged combustion engine made in the U.S. We look forward to supporting ULA’s longstanding role in launching national security payloads.”

We’ll update this report with anything we hear from SpaceX.

Roper said the procurement process has already saved the government billions of dollars, and he expected the pace of launch innovation to extend into the next phase of the U.S. launch industry’s evolution.

“This has been long in the making, and a great day for space,” Roper said. “We’re proud to add this to all the accomplishments that have happened in space over the past eight days, with going to Mars and getting astronauts back. … But we’re not done with launch. This is the beginning of what is going to be a long-term competition in access to space.”

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