By Philip Shishkin
Heightened tensions between Russia and the U.S. are hampering
their cooperation in space, adding to the problems of an American
space industry reeling from the crashes of two commercial
spacecraft this fall.
Russia is a critical player in the business of carrying payloads
into orbit, from communications satellites for Western companies to
American astronauts traveling to the international space
station.
But after Moscow grabbed Crimea from Ukraine in March, the U.S.
State Department temporarily stopped issuing licenses for exporting
sensitive defense-related technologies to Russia, including
satellites, as part of broader sanctions imposed against the
Kremlin. And in September, the National Aeronautics and Space
Administration announced plans for two U.S. companies to build
spacecraft to carry American astronauts to the space station,
reducing its reliance on Russia.
But questions have cropped up about the capabilities of the
budding commercial-space industry after October's explosion of an
unmanned Orbital Sciences Corp. rocket destined for the space
station and the deadly crash of a Virgin Galactic LLC spacecraft.
The Orbital rocket was powered by a refurbished Soviet-designed
engine. The company now says the use of these engines "likely will
be discontinued."
The U.S. technology-licensing freeze jolted International Launch
Services, which is based in Reston, Va., and controlled by the
Russian government. The company uses Russian rockets, originally
designed to carry nuclear warheads, to launch satellites that beam
SiriusXM radio to American cars and provide broadband to the U.S.
Navy, among other missions.
International Launch Services and its clients pressed the U.S.
government to reconsider the satellite portion of the freeze,
according to company President Philip Slack, a former Boeing
executive. In May, the State Department exempted commercial
satellites from the suspension.
U.S.-Russian cooperation in space has been "very visible, and
it's very symbolic. How long that can be insulated from the larger
tensions in the relationship is unclear," said Scott Pace, a former
NASA official now at George Washington University.
The $5.4 billion-a-year market for commercial-satellite launches
depends heavily on Russian rockets, and the recent political
pressure has sparked concerns about their supply over the long
term. In addition, the reputation of those rockets has been marred
by a string of failures.
Since the 1990s, American satellites have been banned from
traveling to space aboard Chinese rockets, barring a presidential
waiver. The ban was part of Washington's sanctions against Beijing
for the 1989 military crackdown on protesters on Tiananmen Square.
Later, the U.S. became concerned about China's role in weapons
proliferation and industrial espionage.
For now, Western satellite companies are hoping the crisis in
Ukraine and the U.S. sanctions go no further. "It could all change
in a heartbeat. It's difficult to predict," said an executive with
a European satellite company. "We are keeping an eye on the
geopolitical situation."
Over the years, Moscow and Washington have developed a symbiotic
arrangement in space, ever since the 1975 "handshake in space"
celebrating the first joint U.S.-Soviet space mission. When the
Cold War ended, Washington was eager to find ways to keep Russian
space scientists and engineers occupied with Western-oriented work,
in part to make it less likely they would provide services and
products to unfriendly states.
There was a commercial rationale, too. Soviet engineers had
developed dependable ways of getting stuff into space, and, in some
cases, it was cheaper and easier to buy Soviet-built products than
design American alternatives from scratch.
The international space station is funded and operated jointly
by the U.S., Russia and other nations. After the U.S. suspended its
space-shuttle program in 2011 because of cost and safety concerns,
American astronauts have been traveling to the space station on
Russian rockets.
Congress recently asked NASA to clarify its space-station plans
in light of "serious questions" about the future of U.S.-Russia
space cooperation. Moscow has sent mixed signals about its
commitment to the project. In September, NASA picked Boeing Co. and
Space Exploration Technologies Corp., known as SpaceX, to build
spacecraft to carry American astronauts to the space station
starting in 2017.
International Launch Services, known as ILS, began in the 1990s
as a joint venture between Lockheed Corp., now Lockheed Martin, and
a Russian design lab known as Khrunichev State Research and
Production Space Center. The Russians eventually acquired full
control. The company markets one product: the Proton rocket
developed in the 1960s as part of the Soviet fleet of
intercontinental ballistic missiles. It launches them from
Kazakhstan.
Over the years, ILS and a French rival, Arianespace SA, have
grown to dominate the market for launching heavy satellites,
although SpaceX is starting to compete.
Separately, SpaceX has filed a lawsuit against the U.S.
government to try to force it to end its reliance on Russian-built
engines to power American rockets that take sensitive military
payloads to space. Air Force Secretary Deborah Lee James said in
July the military wants to end its reliance on Russian engines "as
soon as we can."
Meanwhile, safety issues have cropped up with Proton rockets. In
May 2013, a Proton carrying Russian government payloads crashed
within seconds of takeoff because some speed censors had been
installed incorrectly, a Russian probe later found. The
failure--the fifth in as many years--spooked satellite companies
that do business with ILS, which uses Proton rockets. Customers pay
ILS up to $95 million a launch.
When the State Department suspended defense-related exports
earlier this year, ILS and its customers launched a lobbying
effort. One notable client is Inmarsat PLC, a British company
rolling out a trio of U.S.-made satellites to provide high-speed
broadband to the U.S. military, among others. Inmarsat already had
launched one satellite with ILS, and had the other two waiting for
liftoff. By May, the State Department lifted the suspension.
Inmarsat declined to comment.
In May, around the time the State Department exempted satellites
from the export freeze, another Proton rocket, also on a Russian
government mission, crashed because of engine failure. "Proton has
had more failures than it should, without a doubt," says Mr. Slack,
the ILS president. Mr. Slack says his bosses in Moscow are working
hard to fix the problems.
This summer, ILS laid off a quarter of its staff to compensate
for fewer orders.
Then another problem surfaced: The Russian government was
jumping ahead of ILS customers in the launch queue. Russian state
missions use the same Proton rockets, and by Russian law, the
Kremlin has priority over commercial customers.
Write to Philip Shishkin at philip.shishkin@wsj.com
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