RpK fights COTS termination

Last month, NASA issued a notice to Rocketplane Kistler (RpK) announcing its intent to terminate the $207-million COTS award the space agency made to the company last August. NASA cited RpK’s failure to meet its financing milestones in its agreement. That notice started a 30-day waiting period before NASA would take any action to terminate the agreement; that period expires in less than week.

RpK, as you might expect, is fighting any bid by NASA to terminate the award. NASA SpaceFlight.com reports that the company sent a seven-page letter to NASA associate administrator Scott Horowitz protesting the decision, putting much of the blame for RpK’s financing problems on the space agency itself. Specifically, the company claims that NASA’s decision in the spring to procure additional Soyuz spacecraft, and then the release of an RFI in August for Phase 2 of COTS (one that did not strictly require potential bidders to have demonstrated their capabilities in Phase 1), harmed the company as it was trying to make its business case to potential investors.

Despite those obstacles, RpK claims it was able to raise a substantial fraction of the $460 million it needed (it already had $40 million in hand from a previous round). Interestingly, much of the money came from unnamed Canadian sources, including a “large Canadian investment fund” that was willing to fund up to all of the company’s requirements; that offer was blocked because of NASA requirements that a “sizeable” fraction of the investment come from US sources. By August, a combination of the NASA COTS Phase 2 RFI, as well as the sub-prime mortgage crisis that roiled financial markets in recent months, caused that deal to fall through.

How effective will this protest be? It’s hard to say now, but it certainly appears that much of the industry does expect NASA to terminate the COTS agreement with RpK and conduct a new competition for the remaining money (about $175 million) in that deal, with everyone from the other COTS awardee, SpaceX, to companies large and small lining up to submit proposals.

1 comment to RpK fights COTS termination

  • Peter Shearer

    RpK was officially fired by NASA last week. SpaceX was going to win anyhow, with any luck they can get the remaining money and boost their rockets chances. (pun intended)

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