NASA Extends CRS Contracts, Will a New Competitor Come Forward?

ATV-4 Prepares for Launch, Image Credit Arianespace

NASA has announced that it is extending the existing commercial resupply contacts held by Orbital Sciences and SpaceX through 2017, even as it holds the door open for competition from other potential providers in the next round of competition labelled CRS2.  Based on the announcement which is included below, NASA is planning on offering a series of one year extensions which would create the opportunity to “on ramp” new providers which demonstrate the required capabilities.

With both Arianespace and United Launch Alliance recently suggesting the NASA contracts represent an unfair advantage for SpaceX in terms of overall competition, it will be interesting to see if either actually submits a credible bid.  In Arianespace’s case, doing so would require an “Americanized” launch vehicle, while for ULA the challenge would be in dramatically reducing its launch costs, a move for which there is no sign whatsoever.  

The real questions however, may concern the current providers.  Orbital Sciences, having dropped its lawsuit against ULA over the RD-180 main engine, needs to sign an agreement for more engines for the Antares booster, as well as hope it can continue to source its first stage from Ukraine without political interruption.

For SpaceX, a more intriguing possibility comes up.  What happens if the company achieves Falcon 9 partial reusability in the coming decade?  It would still need to find a possibly elusive first commercial customer for a “barely scratched” reusable rocket. NASA was willing to give the original Falcon 9 a chance to go to the Station on only its third flight, would it do so again?  

The synopsis follows:  

“NASA/JSC intends to extend the existing Commercial Resupply Services (CRS) contracts NNJ09GA02B, with Orbital Sciences Corporation, hereinafter referred to as Orbital, and NNJ09GA04B, with Space Exploration Technologies, hereinafter referred to as SpaceX for up to 24 months from December 2015 to December 2017 at no cost. Both contracts were awarded in December 2008 and have a not to exceed (NTE) contract value of 3.1B each.

NASA/JSC has a requirement to perform all tasks necessary to ensure safe and reliable cargo integration and transportation to and from the International Space Station (ISS). With the extension of ISS to 2024, NASA intends to procure follow-on Commercial Resupply Services (CRS2) through the life of the program through full and open competition. The extension of the existing CRS contracts allows possible new providers the opportunity to address the readiness requirements necessary to show ISS integration capability before cargo services are required. This extension is expected to be executed one year at a time so that if a new provider competing for the above mentioned CRS2 contract can demonstrate their ability to deliver cargo early then it would be possible to award CRS2 contracts such that the second year of the extension would not be required.

The Standard Resupply Mission may consist of pressurized upmass delivery, unpressurized upmass delivery, cargo disposal, or cargo return. Cargo includes both NASA-owned cargo and NASA-sponsored cargo and both pressurized and unpressurized payloads. The supplies to be delivered by terms of the contract include air, water, food, clothing, medicine, spare parts, and scientific experiments for use in the U.S. and International Partner experimental modules. The place of performance and launch site is identified in each task order.

Both providers are needed to provide these services to reduce the risk to the Agency. Two viable providers are needed to guarantee assured cargo access to the ISS in the event one contractor fails to successfully deliver cargo. An interruption of contract performance would jeopardize the timely delivery of critical cargo.

The statutory authority for proceeding with this acquisition under Other Than Full and Open Competition is 10 U.S.C. 2304(c)(1) as contemplated by the provision of FAR 6.302-1(a)(2)(iii), which states that full and open competition need not be provided when the services required by the Agency may be deemed to be available from one original source, in the case of a follow-on contract, for the continued provision of highly specialized services. The provision also states that this exception is applicable when it is likely that award to any other source would result in unacceptable delays in fulfilling the Agency’s requirements and substantial duplication of cost to the Government that is not expected to be recovered through competition would be incurred. Both contracts will be extended under this authority.

Orbital and SpaceX were required to prove that their vehicles could successfully integrate with the ISS to deliver cargo. This seminal milestone took place under Commercial Orbital Transportation System (COTS) agreements. Demonstrating successful ISS integration is essential to limiting NASA’s risk of damage occurring to valuable cargo and/or damage being done to the ISS itself. Orbital demonstrated successful ISS integration in June 2013 and SpaceX demonstrated successful ISS integration in April 2012. Hence, any party that is interested must have demonstrated successful ISS integration upon submission of any response. SpaceX and Orbital are the only U.S. commercial providers who have demonstrated this capability to date.

The Government intends to acquire a commercial item using FAR Part 12.

Interested organizations may submit their capabilities and qualifications to perform the effort in writing to the identified point of contact not later than 4:30 p.m. local time on April 11, 2014. Such capabilities/qualifications will be evaluated solely for the purpose of determining whether or not to conduct this procurement on a competitive basis. A determination by the Government not to compete this proposed effort on a full and open competition basis, based upon responses to this notice, is solely within the discretion of the government.”

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