Investing in Space: Why Blue Origin’s engine explosion matters

Investing in Space: Why Blue Origin’s engine explosion matters

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CNBC's Investing in Space newsletter offers a view into the business of space exploration and privatization, delivered straight to your inbox. CNBC's Michael Sheetz reports and curates the latest news, investor updates and exclusive interviews on the most important companies reaching new heights. Sign up to receive future editions.

There's a reason the saying that's why we test exists. I've seen it a lot in my mentions the past few days. Unfortunately, and crucially, it ignores that tests happen for different reasons.

Let's get into that, especially in light of the recently unveiled explosion of a BE-4 rocket engine during Blue Origin's testing in Texas. The engine was bound for the second launch of its customer United Launch Alliance's Vulcan rocket.

It's worth understanding the three main phases of rocket engine testing: Development, qualification and acceptance. An industry specialist with over a decade of experience in this type of testing posted a helpful rundown about how these phases differ. Here's a tl;dr version:

I don't report on every rocket engine that blows up. Most of the ones I hear about are in the first two phases. But more importantly, BE-4 is years behind schedule (the first flight engines were originally contracted for delivery in 2017), and this was the third production engine. Of course it's better to lose an engine in testing than during a launch, especially on a rocket that can't lose an engine to succeed, but that's an overly dismissive way to view the loss of expensive production hardware – let alone another setback.

The downstream effects are especially why this matters. The first pair of BE-4 engines recently passed a critical test on Vulcan for the first launch. ULA CEO Tory Bruno is adamant that it's very unlikely the incident will set back the timeline for Cert-1, currently scheduled for the fourth quarter. (Bruno will be sitting down with reporters Thursday for a roundtable, which was on the schedule before word got out about the BE-4 incident. I'll be listening in – so stay tuned for any more potential details on Vulcan's situation.)

But ULA doesn't need just Cert-1 to fly: The company needs Vulcan to complete two launches successfully before the U.S. Space Force will sign off on it flying valuable national security missions. SpaceX is dominating the launch market and many in the industry, both competitors and customers, fear a monopoly. All six of ULA's recently assigned Space Force missions are set to fly on Vulcan, since the company's currently operational rockets are retiring.

So maybe this doesn't affect Cert-1, but what about Cert-2? Bruno believes the BE-4's failure in acceptance testing does not affect the previous qualification tests that Blue Origin has done. Even if they don't need to re-qualify the engine, they still need to close the investigation – in which Blue Origin says it's already found a likely cause of the explosion – check future production engines for the same flaw or flaws, and test the replacement.

As one propulsion engineer wrote on social media: You learn a lot in development testing. You learn a little bit in qualification testing. Blessed be they who continue to learn in acceptance testing.

Which brings us to another refrain I've seen in my mentions these past few days: Space is hard. It's sounding a little too much like thoughts and prayers these days.

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