NASA Gives Boeing-Lockheed Firm $1.1 Billion Shuttle Contract

NASA gave a joint venture of The Boeing Co. [BA] and Lockheed Martin Corp. [LMT] a $1.1 billion cost reimbursement pact to run space shuttle program operations.

The letter contract valued at $1.1 billion goes to the venture, United Space Alliance LLC (USA) of Houston. When the initial six-month contract is definitized, it will result in a four-year contract through Sept. 30, 2010, to cover space shuttle program operations.

It is a cost reimbursement contract, with provisions for award and performance fees.

Under present NASA plans, the shuttle fleet is to finish hoisting huge components of the International Space Station (ISS) into orbit, where spacewalking astronauts will attach them to the ISS. Only the shuttles can carry such huge components into space. The contract ends in 2010, when the ISS construction job is to be completed and the shuttle fleet is slated to be retired.

Last month, Space Shuttle Atlantis landed safely after having restarted the stalled ISS construction program with installation of a huge P3/P4 truss and solar array. (Please see Space & Missile Defense Report, Monday, Sept. 25, 2006, page 1.)

The next launch, a liftoff of Space Shuttle Discovery, is slated for 9:38 p.m. ET Dec. 7, in a window running until Dec. 26.

Lockheed and Boeing are the largest and second-largest defense contractors, respectively, and they just received clearance from the Federal Trade Commission to form another joint venture, United Launch Alliance, to handle medium to heavy launch services for customers such as the military, NASA and NOAA. (Please see full story in this issue on page 1.)

Under the shuttle program contract, USA will provide a wide array of services during the closing years of the shuttle program.

Those services include work and support for mission design and planning; software development and integration; astronaut and flight controller training; system integration; flight operations; vehicle processing, launch and recovery; vehicle sustaining engineering; flight crew equipment processing; and shuttle and ISS support activities for the Constellation Program.