MDA’s big bet on commercial space stations

Canadarm3 technology is going commercial.

The long-time operator and builder of the Canadarm space hardware recently repurposed the newest generation of robotic arm applications for a forthcoming commercial space station.

This month, Brampton, Ont.-based MDA announced a contract selling 32 external robotic interfaces — the grappling fixtures upon which the arm operates — to Axiom Space, a Houston company that wants to put its own space station into orbit.

The contract value was not disclosed in a press release, but the sale signals that commercial space stations are significant enough to catch the attention of one of Canada’s biggest space companies, which is willing to leverage long-standing government investment in Canadarm to make a bet on an emerging commercial market.

“We’re looking at how can we commercialize Canadarm3,” Holly Johnson, MDA’s vice-president of operations, told Research Money. While both Canadarm2 and Canadarm3 fixtures are included in the contract, she added, “the fact that Axiom has bought interfaces that are compatible with Canadarm3 opens the door for potential future work for us.”

MDA’s reputation and ability to get on the ground floor of numerous robotics projects is helping to work in the company’s favour, said Western University’s Adam Sirek. He holds joint affiliations in the Schulich School of Medicine & Dentistry and the university’s Institute for Earth and Space Exploration.

“I think it’s the perfect next evolution of what they’re doing, and they’ve demonstrated success in the past with spinoffs of Canadarm technology in surgical robotics,” Sirek said. “But the new burgeoning space field is the commercial space sector.”

Canadarm3 is the flagship project for Canada’s government space program. First announced in February 2019, it is the Canadian Space Agency-funded contribution for the Gateway space station that NASA hopes to deploy in lunar orbit later in the 2020s.

By signing on with Gateway, in exchange Canada received access to astronaut seats on NASA spacecraft for the foreseeable future — including, notably, the second mission of the Artemis moon-landing program. A Canadian will fly aboard Artemis 2, a mission set to orbit the moon in 2024 in preparation for a planned landing the following year.

MDA’s market opportunity for robotics, including this deal, is so vast the company is busy creating a “robotics centre of excellence“ to allow even more control of robotics deployments from Canada. In March, the company received nearly $269 million for Canadarm3’s second phase, a design contract positioning it for future awards of the estimated $1 billion project.

The Trudeau government framed the Phase B funding as key to applying Canada’s Industrial and Technological Benefits Policy in a new field: space exploration. MDA’s work, the CSA said in March, “will help ensure that Canada’s contribution to the Lunar Gateway will be designed and built in Canada with the direct involvement of Canadian suppliers.”

In other words, both MDA and the Canadian government say Canadarm3 is a boon for all of the suppliers, universities, technologists and others that MDA touches for its robotic work. Axiom, one of several companies receiving funding from NASA to build successors to the International Space Station (ISS), even has a Canadian connection — Montreal investor Mark Pathy flew aboard its debut crewed space mission in April after paying for a seat.

“It’s just an amazing opportunity for us to take all of the investment from Canada and develop the technology to build the next generation of a robotic system,” Johnson said of the Axiom deal.  “To have real opportunities to spin that off to commercial players right now is really exciting.”

MDA’s bet on commercial space builds on Canada’s successful record of getting in on the ground floor of major space initiatives. The first Canadarm flew on the second-ever space shuttle mission in 1981. Canadarm2 was so good at helping to build the space station, starting in 2001, that it was repurposed for berthing commercial cargo vehicles nine years later — a use for which the designers never imagined it would be needed.

The difference this time, however, is Axiom is not a government entity — although Axiom, like MDA, is getting a healthy share of government funding. In February 2020, Axiom received a NASA contract valued at US$140 million to provide at least one habitable module on the ISS, which should eventually expand into a detachable space station.

NASA then followed up its commercial space station support with three funded Space Act Agreements worth up to US$415.6 million. The trio of companies receiving this funding in December 2021 include Blue Origin, Nanoracks, and Northrop Grumman.

Similar Space Act agreements from a decade ago eventually led to launching commercial cargo spacecraft to the ISS starting in 2012, along with commercial missions carrying astronauts in 2020, said Michael Dodge. Dodge is an associate professor of space studies at the University of North Dakota, and holds an LL.M. degree in aviation and space law from McGill University.

SpaceX, Dodge argued, was a notable beneficiary of these past ISS deals. “The Space Act agreements that they had with NASA provided them a great deal of funding to experiment and do things that had never been done before, which was the point behind the funding,” he said.

Among SpaceX’s fast-growing business lines, one direct benefit of NASA’s support was allowing the company to develop the Crew Dragon astronaut vessel and resell it to carry one independently funded crew, called Inspiration4, to Earth orbit and back in 2021.

But amid this early-stage NASA support is some worry about whether the new space stations will be ready in time. Ongoing sour relations with Russia, complicated by an aging ISS whose intergovernmental agreement expires in 2024, may create a gap in the burgeoning low-Earth orbit economy that includes manufacturing and science research.

A December 2021 report from NASA’s Office of the Inspector General (OIG) warned the agency may not get its wish to extend the ISS agreement to 2030. Even if an extension is granted, there is a risk of the now 22-year-old orbital complex’s oldest elements succumbing to age, despite NASA’s best efforts at upgrading the modules, solar arrays, and other components.

Moreover, the OIG warned, early-stage space projects are notorious for being over schedule and budget, meaning the commercial space stations may not be ready when, in the best-case scenario, the ISS completes its mission in 2030.

MDA’s Johnson said one of the most important things for their Axiom contractor is to stay on schedule, increasing the likelihood that circumstances will favour the deal. Referring to conversations with potential commercial space station providers, she noted, “they’re actually at a pace that’s at least at the same or potentially faster” than NASA’s needs, giving MDA confidence that things will proceed to plan as far as possible.

Sirek envisions risks beyond simply falling behind. “What if you backed the wrong horse and you never know?” he asked. As with multiple space station providers at an early stage it is difficult to assess which one might be viable, he added, although Axiom has done well so far. “They’ve managed to do a successful commercial launch of the first private crew to the space station, and that mission went very well for them.”

Legalities are another issue. The ISS has an intergovernmental agreement in place that regulates the 15 or so space agencies that work upon it, but how each nation’s liability extends to commercial providers is something that Western University — among many others — is trying to assess.

The United Nations Outer Space Treaty, signed in 1967, forms the backbone of space law, which then assumed exclusive government participation in space. While convention today suggests launching states (like the U.S.) are responsible for commercial entities operating in their jurisdiction, that framework may be imperfect for the new generation of space exploration.

Space, as Western’s Sirek said, is “a very dangerous and intolerant environment”, and the risk is that new commercial entrants in the market may have less of an appetite for liability than government. He warned of “an invisible line down the middle”, between Axiom’s space modules and the ISS modules operating under intergovernmental rules, which could have distinct legal implications, depending on a space flyer’s physical location in the space station.

Even after a space station is funded by NASA and completed, UND’s Dodge points out, space law implies the agency will continue to be responsible in some form.

“That’s the biggest policy challenge here,” he said. “In essence, commercial providers will have to behave according to the way the states are expected to behave under the Outer Space Treaty regime.”

More broadly, there is the question of how viable the commercial space station business will be. Dodge called that uncertainty “the greatest fog”, in terms of assessing opportunities.

Yet no matter what source you use, the commercial space market does appear to represent a tremendous opportunity to Canadians. With a nod to research from Morgan Stanley, the federal government suggests the global space market as a whole will be worth US$1.1 trillion in the next 20 years — triple today’s estimated value.

While Morgan Stanley said the most significant share of the business will go to commercial broadband satellite services like SpaceX’s Starlink, other key pillars in the new economy are expected to include business where MDA’s robotics could play a role — including lunar landing, asteroid mining and addressing space debris.

MDA’s Johnson also adds in-space manufacturing and satellite refuelling to the list of robotics applications. She cited a U.S. National Science and Technology Council report for the White House released in April, which outlined the industry’s importance to making future space systems more resilient.

“The world will benefit from having robotics in space,” she said, noting that MDA’s and Canada’s investments to date can be applied just about anywhere space explorers may go — along with helping those living or working in remote environments on Earth. “It’s a really impressive business.”

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