Constrained by Money, NASA, Charts a New Course

Will Abandoning the International Space Station Set Investors Adrift?

Boeing (NYSE: BA) and its partners spent more than $100 billion to build the International Space Station (ISS). But in 2023 (or 2024 at the latest), Russia plans to take that investment apart -- detaching Russian-built sections of the ISS, and moving them into a new orbit to form the core of a new, all-Russian station.

 From article, (Money does not grow on trees -- especially not in space. Much as NASA loves space exploration, budget constraints necessitate picking and choosing the work it can afford to support, and outsourcing the rest. In saving money by cutting the ISS loose, NASA said that it hopes to free up funds to instead:

• fund development of the "Space Launch System rocket and Orion spacecraft," targeting a robotic flight "around the moon" in 2020 and a first crewed mission in 2023.
• sponsor "progressively complex robotic missions to the surface of the moon."
• "return ... humans to the moon for long-term exploration and use."
• build a "power and propulsion element to orbit the moon as the foundation of a Lunar Orbital Platform-Gateway."
• and thereby support "human missions to Mars and other destinations."

if you ask me, this is what investors should really be focusing on -- not NASA's abandoning the space station, and potentially terminating contracts for Boeing, Orbital ATK(NYSE: OA), SpaceX, and Sierra Nevada to build rocketships to staff and supply it.

Instead, I think investors should focus on the potential for new and different contracts being awarded for all the other space missions NASA will be able to undertake once released from the ISS cash drain.

Currently, NASA devotes as much as 20% of its budget to supporting the ISS -- anywhere from $3 billion to $4 billion annually. That's money that could perhaps be better spent accelerating development of the Space Launch SystemOpens a New Window., still under development by a team of contractors that includes Boeing and Lockheed Martin, Orbital ATK and Aerojet Rocketdyne. It's a source of funds for building a cislunar outpostOpens a New Window. to facilitate missions to the moon and Mars, and to pay for initial efforts at returning mankind to the MoonOpens a New Window. -- and mining itOpens a New Window..

And even before the ISS is handed over to private industry to operate, there may be opportunities for investment. To facilitate the station's transition to private ownership, the administration is asking Congress to allocate $150 million to NASA in 2019, and recommending NASA "expand international and commercial partnerships" to operate the ISS "over the next seven years."

And during this interim period, the administration wants to boost NASA's budget to pay for "development and maturation of commercial entities and capabilities [that will become] commercial successors to the ISS." This, too, will cost money -- and could give rise to an entirely new set of (perhaps eventually public) companies working to make the ISS a commercially viable operation.

Already, privately held Made in SpaceOpens a New Window. has a 3D printer aboard the station, and as that technology develops, it's conceivable the ISS and other space stations could "print" their own replacement parts on-site. Bigelow AerospaceOpens a New Window. -- also private today -- has for months been testing an inflatable module attached to the ISS, which could one day replace the sections Russia will be detaching. Similarly, established space companies like Boeing, Lockheed, and Orbital have all proposed novel alternatives for converting spent rocket sections into habitable living space for the ISS, or for a new space station.)

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