ULA Wins Big with Two AF Propulsion Contracts, One with Blue Origin, One with Aerojet Rocketdyne

ULA Wins Big with Two AF Propulsion Contracts, One with Blue Origin, One with Aerojet Rocketdyne

The Air Force awarded the last two of four contracts to develop new rocket propulsion systems today.  The United Launch Alliance (ULA) is partnered with Blue Origin on one of the awards and with Aerojet Rocketdyne on the other.  The Air Force announced the other two awards last month.

The Air Force is using “Other Transaction Authority” to enter into public-private partnerships with companies to develop new rocket engines.  The first two awards went to Orbital ATK and SpaceX in January, with initial government investments of $46.9 million for Orbital ATK and $33.6 million for SpaceX.

The awards announced today will benefit ULA’s development of a new rocket, Vulcan, to replace its existing Atlas V.

The government’s goal is to have at least two competitive U.S. launch vehicles, using American-built engines, to launch national security satellites beginning in 2019.  The catalysts for this effort were a congressional decision to end use of Russian RD-180 engines, which power the Atlas V, because of Russia’s actions in Ukraine, and more broadly a desire to lower launch costs through competition.  ULA has been essentially a monopoly provider of national security launch services with its Atlas V and Delta IV rockets since it was formed in 2006 as a joint venture of Lockheed Martin and Boeing.  The debate over RD-180s and the timing of the transition to an all-American rocket is much debated and has been reported extensively on this website.

ULA initially chose Blue Origin as its engine partner to build an American-only alternative to the Atlas V.  Blue Origin, owned by Jeff Bezos, is developing a new type of engine that uses liquid oxygen and liquefied natural gas (methane).  Designated BE-4, Blue Origin is funding the engine development program itself.  Two BE-4s would replace one RD-180, although other engineering modifications are needed.  It is not a simple swap.  The contract announced today will pay for integrating the engine into the new Vulcan rocket and for ULA to develop a new Advanced Cyrogenic Evolved Stage (ACES) upper stage.  The initial government investment for this contract is $46.6 million — $45.8 million for the integration effort and $0.8 million for ACES.  Neither ULA nor the Air Force announced the total potential government
investment, only the initial investment.

ULA subsequently decided to partner with Aerojet Rocketdyne as a “backup” in case Blue Origin’s engine did not work out.  Aerojet Rocketdyne is developing the AR1 engine that will use traditional liquid oxygen and kerosene.  The other contract announced today is for that effort.   Aerojet Rocketdyne said in a press release that the total agreement is valued at $804 million, with the Air Force potentially investing $536 million and Aerojet Rocketdyne and its partners $268 million.  The initial government investment is $115.3 million, with Aerojet Rocketdyne and ULA contributing another $57.7 million.

Aerojet Rocketdyne President and CEO Eileen Drake said the AR1 has the least technical risk and work is expected to be completed no later than Dec. 31, 2019.   Sen. John McCain (R-AZ), the leading advocate for replacing Russian RD-180s with an American-made engine, put 2019 in legislation as the date by which the new engine must be ready.  Drake said the AR1 will be available for use on the Atlas V, Vulcan, and “other launch vehicles in development.” 

ULA President Tory Bruno said that ULA is “fully committed to transitioning as quickly and affordably as possible to a domestic engine” and Aerojet Rocketdyne “is moving us toward one of two viable options with the excellent progress on the AR1 engine development.”

In a separate press release about the Blue Origin contract, Bruno said ULA continues to work with both Blue Origin and Aerojet Rocketdyne “to pursue two options for a next-generation American engine and that is why we are teaming with two of the world’s leading propulsion companies.”

Lt. Gen. Samuel Greaves, commander of Air Force Space and Missile Systems Center and the Air Force’s Program Executive Officer for Space said these “innovative public-private partnerships” are key to assuring access to space and addressing “the urgent need to transition away from strategic foreign reliance.” 

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