Following the unsuccessful launch of the Intelsat 27 spacecraft on February 1, 2013, majority owner RSC Energia affirmed last week its unfailing commitment to the long-term success of the Sea Launch program. But despite the assurances from the Sea Launch partners, the company faces grim prospects. In addition to its difficulty to now secure launch contracts necessary for its survival, the company also faces a big lawsuit that could dampen prospects of Sea Launch’s emergence from bankruptcy.
S.P. Korolev Rocket and Space Corp. “Energia” President Vitaly Lopota said last week partners of the Sea Launch program are in the process of creating a strategy that will ensure the long-term viability of the Sea Launch system and provide for evolutionary improvements in its performance.
“We remain confident that the Sea Launch program will continue to remain a key launch service provider to the world’s spacecraft operator community for years to come,” Lopota said. “I urge all current and potential customers of Sea Launch to be patient, recognizing the strategic importance of launch vehicle diversity to their own business. We can assure you that Sea Launch will continue to launch our customer’s spacecraft on schedule, reliably and with a high level of injection accuracy.”
RSC Energia, which dominates a large part of the Russian space program, is 38%-owned by the Russian government. Through subsidiary Energia Overseas Ltd., RSC Energia now owns 95% of Sea Launch, following the company’s reorganization plan after emerging from bankruptcy in 2010. Boeing Defense, Space & Security and Kvaerner, now called Aker Maritime Finance AS, split the remaining 5%.
But on February 5, Boeing sued RSC Energia and and two Ukrainian state-owned companies, PO Yuzhnoye Mashinostroitelny Zavod and KB Yuzhnoye, for their failure to pay Boeing more than $350 million following the joint-venture’s bankruptcy filing in 2009.
The breach-of-contract lawsuit, filed in U.S. District Court in Los Angeles on Friday, alleged that the three companies failed to reimburse Boeing for its investment in the original Sea Launch Co. The U.S. aerospace company said it provided substantial funding for the venture, and the partners agreed that, if it failed, they would reimburse Boeing their share of the funding.
Bloomberg quoted Boeing as having stated: “Yuzhnoye and Energia owe Boeing and BCSC more than $350 million, with interest continuing to accrue daily… Instead of paying claims to which they have no defense on the merits, Yuzhnoye and Energia have decided to stall and evade, forcing plaintiffs to chase them around the world to secure payment of debts clearly owed.”
Sea Launch is a Russian spacecraft launch service that uses a mobile sea platform for equatorial launches of commercial payloads on specialized Zenit 3SL rockets. The sea-based launch system uses rockets that can be fired from the optimum position on Earth's surface, considerably increasing payload capacity and reducing launch costs compared to land-based systems.
Sea Launch’s was originally established as a joint partnership in 1995 of four companies from Norway, Aker Solutions (20%); Russia, RSC Energia (25%); Ukraine, Yuzhmash and Yushnoye (15%); and the United States, Boeing (40%). The program was managed by Boeing with personnel participation from the other shareholders.
The launcher and its payload are assembled on a purpose-built ship Sea Launch Commander in Long Beach, Calif. Once assembled the vehicle is positioned on top of a self-propelled converted oil platform, the “Ocean Odyssey.” Both the command ship and the platform sail some 4,828 km to an equatorial position at 154 degrees West Longitude, where final pre-launch operations and launch take place. The platform travels about 11 days to the launch site while the command ship sails for about eight days.
Sea Launch sent its first satellite into space in March 1999. Subsequently, it was able to successfully launch 31 out of 35 launch attempts, consisting of commercial communications satellites payloads intended for geostationary transfer orbit with such customers as EchoStar, DirecTV, XM Satellite Radio, and PanAmSat.
The launch failure on February 1 of Intelsat 27 spacecraft was the fourth. Sea Launch had its first launch failure on March 2000 during the company’s second commercial launch. The payload was a Hughes-built communications satellite owned by ICO Global Communications and the cause of the failure was attributed to a software error that failed to close a valve in the Zenit’s second stage. In January 2007, the Zenit 3SL exploded on the launch pad just seconds after engine ignition. The payload was the Boeing 702 NSS-8. Because of the NSS-8 launch failure, in March 2007, Hughes Network Systems switched the launch of its SPACEWAY-3 from a Sea Launch Zenit 3SL to an Ariane 5.
In another incident on May 31 last year, Sea Launch delivered to Geostationary Transfer Orbit Intelsat 19 spacecraft. But following the launch, one of the satellite's two solar arrays failed to deploy. On December last year, an Independent Oversight Board that investigated the deployment anomaly exonerated Sea Launch’s Zenit vehicle from causing or contributing to the anomaly.
In June 2009 Sea Launch Co. LLC filed for Chapter 11 bankruptcy protection because of weaker demand, mounting debt and a failed launch that led to a $53.2 million arbitration award against the company. Sea Launch emerged from bankruptcy effective October 27, 2010 as Sea Launch AG, headquartered in the Canton of Bern, Switzerland with RSC Energia affiliate Energia Overseas Limited acquiring 95% ownership while the remaining 5% shares held indirectly by Boeing and Aker USA.
