The Midland City Council voted 6-1 last week to spend $10,000 on the renewal of a spaceport license for the Midland International Airport.
Council members seemed to appreciate Councilman Spencer Robnett’s concern about economic development efforts that didn’t pan out, including the failed deals with XCOR Aerospace and Orbital Outfitters, which have either filed for bankruptcy or gone out of business since. Councilman Jeff Sparks even said during the meeting he felt the council was “duped” and that XCOR, in particular, was not what the council was led to believe.
Director of Airports Justine Ruff told the Reporter-Telegram on Monday that a total of $2 million in city dollars has been spent on the spaceport through Airport Operations Fund, which she said is funded through parking lot fees and money brought in through minerals on airport land.
Sparks and Councilman J.Ross Lacy also mentioned the “$10 million” in tangible assets that exist at Midland International because of Midland Development Corp. and Governor’s Office investments in aerospace in Midland.
Following the bankruptcies of XCOR and Orbital outfitters, Midland City Councilman Spencer Robnett says it’s time to end the city’s efforts to establish a viable spaceport.
In an opinion piece published by the Midland Reporter Telegram, Robnett wrote:
At this Tuesday’s City Council meeting, we will consider a resolution extending a contract with SilverWing Enterprises for contractual services to renew our spaceport license for 5 years. I will vote against extending the spaceport license and any future spaceport agenda items and would encourage my fellow councilmen and councilwoman to do the same.
What was initially touted as a chance to diversify Midland’s economy and bring space tourism, space research and space travel to West Texas has cost the taxpayers of Midland over $20 million to date with nothing to show for it. Since this community began pursuit of a spaceport designation, Midland’s population has grown at unprecedented rates and Permian Basin oil production has tripled. Based on some reports, Basin production could again double by 2023 with $300 billion in upstream investment forecast during that time period. We need to spend our tax dollars supporting infrastructure that helps drive what makes Midland unique and prosperous, not chase speculative diversification efforts at the taxpayers’ expense.
The Wall Street Journalreports that Defense Secretary Jim Mattis plans to remove John “Jay” Gibson II from the post of chief management officer (CMO) for a “lack of performance.”
The decision comes less than a year after the former XCOR CEO joined the Defense Department as deputy CMO in November 2017. The Senate subsequently confirmed him as defense CMO in February 2018.
In that position, Gibson’s job is to find ways of making the massive defense bureaucracy more efficient to free up funding to modernize the armed forces.
XCOR hired Gibson in March 2015 to replace founder Jeff Greason as CEO. The objective was for Gibson to focus on the business side while Greason focused on completing construction on the Lynx suborbital space plane.
That arrangement did not work out. By November, Greason and two other founders, Dan DeLong and Aleta Jackson, had left the company to found Agile Aerospace.
The Trump Administration announced its nomination of Gibson for the post of deputy CMO in June 2017. He left XCOR shortly thereafter at a time when the struggling space company laid off all its employees. A few people were hired back on a contract basis.
XCOR filed for bankruptcy in November 2017. The company’s assets were purchased by a non-profit organization.
There’s some news from Cornwall on the spaceport front:
Cornwall Council has admitted that it is ‘anticipating a positive announcement’ on the bid to have the UK’s first spaceport in Newquay bringing thousands of new jobs and an £1bn a year into the local economy.
Newquay is among eight UK sites vying to become the first spaceport in Europe as the Government aims to meet the growing interest in space tourism.
The Government is expected to announce the location of the spaceport at the Farnborough Air Show which starts on July 16.
If successful, horizontal rocket launches could take place from Newquay , which has one of the longest runways in the country, to see small size satellites put into orbit. The space sector could be worth more than £1 billion by 2030, which is more than 10 per cent of the current economy.
Editor’s Note: It looks like somebody’s got spaceport fever. Also known as Richardson Syndrome, it is a very serious condition that leads people to do and say all sorts of crazy (and often expensive) things. The only cure for that is reviewing the history of commercial spaceports. Preferable with a couple of pints on hand, which you’ll need once you realize what you’ve gotten yourself into.
I’ve lived for six years near Mojave spaceport, which hasn’t seen a spaceflight in almost 14 years. Small rocket launches aside, Spaceport America has stayed largely idle since they dedicated the Virgin Galactic Gateway to Space way back in 2011. (You don’t need to spend $225 million to launch sounding rockets.) Midland’s spaceport dreams expired when XCOR and Orbital outfitters did. Burns Flat in Oklahoma never saw a launch. Florida’s Cecil Airport is still waiting for its first spaceflight.
Maybe things will be different in Cornwall. Maybe they’ll catch a wave. Maybe the timing is finally right. I don’t know. You never say never in this business.
It’s great that they’re willing to pursue this, but they need to manage expectations. And not go giving things away on sketchy promises. One thing that helps is Newquay won’t be dependent on its space business. It’s not like they’re building a spaceport in suburban nowhere and waiting on something that is always 12 to 18 months away.
With two key tenants — XCOR and Orbital Outfitters — out of business, the Midland Development Corporation has hired Interflight Global to advise it on the next steps for Midland’s spaceport.
It’s a move that City Councilman J. Ross Lacy, who also serves as the President for the Midland Spaceport Development Corporation, thinks is a step in the right direction.
“As we continue to move forward and we see the space industry transform, we needed to bring in Oscar and his group to really help us move forward, and, in some of the areas that we are going to be pursuing, it’s critical to have his expertise as we move into a new chapter for the Spaceport in Midland,” Lacy said.
As far as what the consulting firm will specifically address, MDC chairman Brent Hilliard explained “that contract is just to help us write a business plan for the space port.”
As a more clear business direction is carved out for the space port, the MDC will look to fill out the hangars and buildings that have already been built in the space port’s business park, as the park’s former tenants no longer occupy the space.
On Friday, Space.com published a story I wrote about how Build A Plane had purchased XCOR’s assets for use in a school it wants to build down the road in Lancaster. The organization, which focuses on getting planes donated to schools, has launched a parallel program called Build A Rocket.
In addition to the physical assets, Build A Plane also gained control of XCOR’s intellectual property (IP). The IP of Rotary Rocket was included in the purchase.
Motion for Asset Sale Filed by XCOR Aerospace, Inc. Jan. 26, 2018
XCOR Aerospace Inc., filed a motion in the US Bankruptcy Court for the sale of its certain assets on January 26, 2018. The debtor seeks the Court’s approval for the sale of its certain assets to highest bidder, for a purchase price of $1 million in cash pursuant to the asset purchase agreement. The debtor’s assets include personal property of debtor. The initial minimum overbid should be $0.01 million more than the initial purchase price. At the auction, the subsequent bids would be in increments of $0.1 million. The buyer would be entitled to a break-up fee of $0.01 million & administrative expense reimbursement of $0.02 million to trustee. The sale hearing is scheduled for February 20, 2018.
I realize it’s a bit late, but here’s a look back at the major developments in space in 2017.
I know that I’m probably forgetting something, or several somethings or someones. Fortunately, I have eagle-eyed readers who really seem to enjoy telling me just how much I’ve screwed up. Some of them a little too much….
So, have at it! Do your worst, eagle-eyed readers!
The numbers are in on XCOR Aerospace’s bankruptcy, and as one would expect, they’re not real pretty.
The company has $1.1 million in assets and $1,424.66 in cash, according to documents filed with the Bankruptcy Court for the Eastern District of California. XCOR owes $27.46 million to creditors, with $23.6 million in unsecured debts and $3.86 million in liabilities secured by assets.
XCOR’s decision to file for Chapter 7 bankruptcy on Tuesday marks the end of a company that seemed to be in perpetual start-up mode since its founding 18 years ago. Lacking a billionaire backer with deep pockets and a thick Rolodex, the company attempted to develop revolutionary rocket engine technology and a suborbital space plane with funding that would be a rounding error for the giant aerospace primes.
So, how far did it get? What might bidders find valuable when XCOR’s assets are auctioned off? And what problems might have helped to cause the company’s fatal plunge into insolvency?
Henry Vanderbilt has a few ideas on these subjects. Henry is an XCOR shareholder who worked at the company back in the day. He went on to found the Space Access Society, whose conferences were a highlight of the year for the New Space community until recently. (more…)
MOJAVE, Calif. – Troubled XCOR Aerospace, a pioneer in reusable rocket engine technology, filed for Chapter 7 bankruptcy in federal court on Wednesday, according to court documents.
The filing will lead to the liquidation of the 18-year old company, whose engine technology was designed to power the two-person Lynx suborbital space plane XCOR was building. The vehicle, which was designed to take off and land on a runway, was only partially completed before most work on it stopped last year.
XCOR has a matter of weeks to conclude a deal with a potential partner or face liquidation under Chapter 7 bankruptcy.
In an Oct. 19 interview, Michael Blum, a member of the board of directors of XCOR who took over as chief executive at the end of June, said the company has been in discussions with potential strategic partners and other investors interested in its propulsion technology and Lynx suborbital spaceplane, but those negotiations have taken longer than expected to finalize.
“Our time is slowly running out,” Blum said. The XCOR board and its major shareholders have been providing a “minimum amount of capital” over the last several months to keep the company going and pay its bills, but said their patience is running out. “Once that happens, the future gets very bleak.”
XCOR has been in discussions with a number of potential partners and investors, Blum said. One approach has involved discussions with strategic partners, including an unidentified large aerospace and defense company primarily interested in XCOR’s propulsion technology and related intellectual property.
XCOR has also been in talks with investor groups. One such group, he said, is particularly interested in XCOR’s Lynx suborbital spaceplane as a means to quickly get into the space tourism market. XCOR has been working on the Lynx for several years, and the prototype vehicle is about two-thirds complete. A second group, Blum said, is in the industrial and manufacturing sector that is already familiar with XCOR.
MOFFETT FIELD, Calif. (DSI PR) — Deep Space Industries is pleased to announce that Doug Jones, formerly chief test engineer at XCOR, is joining the company’s growing team as director of propulsion systems.
“We see Doug as one of the top rocket engineers in the country, and a great addition to our first-class team of small-spacecraft engineers,” said Bill Miller, the chief executive officer of Deep Space Industries. “He will be helping us develop the high performance, inexpensive propulsion that is critical to radically lowering the cost of deep space exploration.”
Mr. Jones has designed, built and tested over a dozen different rocket designs for a wide range of customers, including two manned vehicles. Doug has decades of aerospace engineering experience ranging from liquid rocket engine design to vehicle system optimization, and has flown aboard a rocket aircraft multiple times while serving as flight test engineer during the development of the XCOR X-Racer.
“Doug Jones is joining DSI at the perfect moment to lead our in-house development of the high-performance propulsion system for our Prospector series of deep space missions,” said Grant Bonin, DSI’s chief technology officer. “We couldn’t be more excited.”
Editor’s Note: And then there were none. Jeff Greason, Dan DeLong and Aleta Jackson preceded Jones out the door. There are no more founders at XCOR.
Former XCOR CEO Jay Gibson told the Senate Armed Services Committee this week that the cancellation of an engine contract by United Launch Alliance led the struggling Mojave-based company to lay off its remaining employees last month.
“We were a subcontractor, and in the days of continuing resolutions we felt like we had a commitment from our prime” for funding that he said would last a year or more. “With less than 30 days notice, we were told that funding was terminated.” (more…)
Despite laying off its 21 remaining employees, XCOR Aerospace isn’t dead yet. But, it’s not in real good shape, either.
It turns out that a major blow to the company was the loss of a contract with United Launch Alliance (ULA) to develop an upper stage for the Vulcan booster.
The primary impetus for the layoffs, Acting CEO and XCOR Board member Michael Blum told me, is the loss of a contract for engine development that the company had with United Launch Alliance. “The proceeds should have been enough to fund the prototype of Lynx [the company’s planned spacecraft], but ULA decided they’re not going to continue funding the contract. So we find ourselves in a difficult financial situation where we need to raise money or find joint developments to continue.” ULA declined to comment. (more…)