Air Force Eyes Replacing Russian Engine With U.S. Option

The U.S. Air Force has taken a first step toward the eventual replacement of the Russian-made engine used in American military and intelligence satellite launches, a sign of the discord between the two countries sparked by the crisis in Ukraine.

The service’s Space and Missile Systems Center issued a “request for information” from industry on potential options to replace the RD-180 engine that has been used for years on the Atlas V rocket by the United Launch Alliance, a joint venture of Lockheed Martin Corp. (LMT) and Boeing Co. (BA)

The Air Force is “considering an acquisition strategy to stimulate the commercial development of booster propulsion systems,” and it is “open to a range of possible options including but not limited to a replacement engine,” according to the document.

U.S. dependence on a Russian-made engine has prompted criticism in Congress since Russia annexed Crimea earlier this year has continued to back separatists in Ukraine. It also has been highlighted by billionaire Elon Musk, whose Space Exploration Technologies Corp. is fighting for Pentagon contracts now held exclusively by the Lockheed-Boeing alliance that he calls a monopoly.

Musk’s company is being reviewed by the Air Force for certification to compete in launching satellites.

Russian Official

Russian Deputy Prime Minister Dmitry Rogozin hinted in May that his country would cut off the supply of engines in retaliation for the escalating tensions over Ukraine, which has spurred the U.S. and the European Union to impose economic sanctions on Russia. Rogozin later told reporters “we will continue working with the U.S. on projects that are lucrative for us,” according to RIA Novosti.

The United Launch Alliance this week received from Russia two more engines, as anticipated, and “we expect another shipment of three engines later this year,” spokeswoman Jessica Rye said in an e-mailed statement.

An independent panel that the Air Force convened said in May said the U.S. “needs to develop a domestic” rocket engine to replace the RD-180.

A new engine may cost as much as $1.5 billion and take as long as six years to develop, the panel of government and industry space advisers said.

Effects of an RD-180 loss “are significant, and near-term options to mitigate them are limited,” according to a summary of what the panel called its “quick reaction review.”

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editors responsible for this story: John Walcott at jwalcott9@bloomberg.net Larry Liebert, Don Frederick

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