In 2024, Russia plans to abandon the International Space Station.
It was the headline that shocked the space community this week, when Russia’s TASS news agency quoted Roscosmos’ new head Yuri Borisov as saying that Russia would “withdraw from this station after 2024” and try to build a new all-Russian space station instead. But maybe investors should take this less as a surprise, and more as… an opportunity?
The writing on the wall
After all, when the International Space Station (ISS) started operating in 2001, it was expected to remain in service for about 15 years. It’s 2022 now, so obviously that original plan has been revised. Yet as early as 2016 (the ISS’s original “expiration date”), Russia was already making noise about wanting to scrap the project, detach its modules and use them as the base for a new all-Russian station.
Ongoing negotiations between the United States, which wants to use the ISS to train private companies to build their own stations, and Russia, which until 2020 was doing good business selling “seats” on Russian rockets, extended the lifetime lease of the ISS – first until 2025, then 2028, and more recently until 2030. But former Roscosmos boss Dmitry Rogozin complained that the ISS costs “a colossal sum” to maintain, and the Russian government has been saying for years that it would rather spend its money on a 100% owned Russian station, to be called the Russian Orbital Service Station (ROSS).
Now, with the advent of Russia’s war against Ukraine and the arrival of a new “cold war” mentality in the United States and Russia, Russia may be ready to abandon the ISS. (Or not. Reuters story that followed the TASS report of just a few hours quoted other Russian officials say Russia could stay with the ISS until 2028.)
An opportunity in space
If Russia Is jumping ship is not necessarily the end of the mission Although this is a multinational effort including elements contributed by the United States, Russia, Japan, Europe and Canada ( roughly in that order), most of the ISS is US owned. In fact, only about 17% of the space station’s mass is “Russian”. But the most important part of that 17% is the station’s Zvezda (“Star”) service module, which is the station’s engine that allows it to maintain orbit and maneuver around space junk.
If and when Russia abandons the ISS – taking Zvezda with it – it is the part NASA needs to replace if it wants to keep the ISS in service until 2030. And that could be an opportunity for companies that can capitalize. If Russia leaves the ISS, NASA may be forced to rush to award an award to an American company to take over the role of Zvezda. Several names are coming forward as candidates for this role – and potential recipients of a NASA contract to build a replacement for Zvezda.
SpaceX is probably the name that comes to mind first. Elon Musk’s pioneering space company has proven adept at solving all sorts of space problems, from reusable launch rockets to communications satellites to lunar landers. SpaceX is a private company, however, offering little chance for investors to profit even if it wins an ISS contract.
Fortunately, two other public space companies are more attractive. Boeing (BA 0.14%), for example, was NASA’s prime contractor in building the ISS in the 1990s and 2000s and probably knows the ISS better than anyone. Boeing also now has a flight-proven and (nearly) human-rated spacecraft – the Starliner – that is capable of reaching the ISS and using its engines to course-correct the space station as a powerhouse. ad hoc, while working on a more permanent solution.
Another publicly traded space company that would have a good chance of winning a Zvezda replacement contract is Northrop Grumman (NOC 5.38%). Like Boeing’s Starliner, Northrop’s Cygnus supply ships can reach the ISS – and in fact, NASA plans to try using Cygnus’ engines to correct the ISS’ course on a future flight. , in order to test this option.
Northrop even won a contract to build a habitation module for NASA’s planned lunar space station, the Lunar Gateway, basing its design on – what else? — a Cygnus supply ship. And if NASA thinks Northrop is qualified to build modules for its New space station, it stands to reason that Northrop would also be first in line to win a contract to build new modules for NASA’s former space station.
Right now, it’s hard to tell how serious Russia is about exiting the ISS sooner than expected. But if he leaves, given the ambitious plans that several space companies have announced in recent years to build their own space stations – but to first practice space station operations and procedures aboard the ISS – I think there is a good chance that NASA is looking for an interim solution to fly the ISS for a few more years.
If that turns out to be the case, Boeing and Northrop (and SpaceX) are all prime candidates for a new ISS contract.