Orbital's Soviet Rocket Engines Had Already Been Slated for Retirement

Antares rockets sit inside the Orbital Sciences Corp. facility at NASA's Wallops Space Facility in Virginia on April 1 Photograph by Andrew Harrer/Bloomberg

Even before the launch destruction of an Orbital Sciences Antares rocket, the commercial space company was planning to retire the half-century-old Russian engines suspected as a potential cause of the failure.

The Soviet-era AJ-26 engine was designed in the 1960s as part of Russia’s space race with the U.S., originally envisioned as a way to propel cosmonauts to the moon. The engines are “refurbished and Americanized,” Frank Culbertson, the Orbital Sciences executive in charge of the NASA program, said Tuesday night in a news conference, defending the AJ-26 as “very robust and rugged” and with a successful track record.
 
At least one person in the industry disagrees. Elon Musk, the founder of rival launch company SpaceX, ridiculed the Antares AJ-26 engine in an interview with Wired magazine two years ago. Musk said most commercial space companies seek “to optimize their ass-covering” by avoiding risk and employing antiquated but proven technologies. SpaceX builds an “octaweb” of nine of its own Merlin engines for its Falcon 9 rocket. Here is Musk’s riff on the AJ-26:

“One of our competitors, Orbital Sciences, has a contract to resupply the International Space Station, and their rocket honestly sounds like the punch line to a joke. It uses Russian rocket engines that were made in the ’60s. I don’t mean their design is from the ’60s—I mean they start with engines that were literally made in the ’60s and, like, packed away in Siberia somewhere.”

Orbital Sciences had planned to replace the AJ-26 with a new engine system in about two years for its future work shuttling NASA equipment to the International Space Station. “The AJ-26s have presented us with some serious technical and supply challenges in the past,” Chief Executive Officer Dave Thompson said Wednesday on a conference call with analysts.

A review of alternatives began last year, and a replacement was recently chosen—work that may be accelerated if the engine is found to be a culprit in the failure. Due to competitive reasons, Orbital is not disclosing which propulsion system it selected, a spokeswoman for the company said in an e-mail.

Orbital Sciences has a $1.9 billion contract to complete eight ISS resupply missions for NASA and plans to bid for more. The Antares mishap could affect the company’s next scheduled flight for NASA, in April, and may delay launches for a year or longer. Thompson said the failure will not affect the company’s 2014 financial results.

The Antares destruction won’t deliver a major financial hit, given that most of the revenue for the launch had been paid and insurance should cover any funds NASA declines to pay, according to a research note by Raymond James analyst Chris Quilty. The bigger troubles could be for the company’s reputation among commercial clients. Quilty also predicted that a “protracted accident investigation” would prompt NASA to shift more supply work to SpaceX.

Orbital says it has a 96 percent success rate on 106 launches since 2004, and a 95 percent rate for 284 launches in the last 30 years. The company, based in Dulles, Va., is also planning to merge with the aerospace and defense units of Alliant Techsystems, a deal that was announced six months ago. In a statement, Alliant said it planned a “thorough evaluation of any potential implications resulting from this incident” including the merger. Orbital shareholders are scheduled to vote Dec. 9 on the $5 billion “merger of equals.”

Orbital’s stock plummeted more than 15 percent Wednesday. Alliant shares declined 5.5 percent, nearly erasing the gain for the year.

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