PARIS — The European Space Agency’s ruling council on Nov. 3 gave what should be the final endorsement needed to free up development funds for the next-generation Ariane 6 launch after a compromise on work shares between Italy and Germany.

The decision, which makes certain that both Germany and Italy will have production lines for the Ariane 6 solid-fueled strap-on booster segments — which also serve as the first stage of Europe’s Vega C rocket in development — was unanimously adopted by the 12 nations participating in the Ariane 6 program.

With this decision, there should be nothing standing in the way of approval by ESA’s Industrial Policy Committee, the last step before Airbus Safran Launchers, the company managing Ariane 6, receives a check from ESA for about 1.7 billion euros ($1.9 billion). That decision is expected on Nov. 8.

“I am very happy about this decision, which required a double two-thirds majority of the participating states,” said Daniel Neuenschwander, ESA’s director of launchers. “You can imagine there was a long discussion over the P120C motor casing work.”

Booster casing issue with Italy and Germany

The P120C is the segment to be used as the Ariane 6 strap-on boosters and as the Vega C rocket’s first stage.

As majority shareholder in the Vega program, Italy had been given the P120C production award, which is now handled by Avio SpA of Colleferro, Italy.

But Germany had said in 2014, when ESA governments gave their initial go-ahead for Ariane 6, that MT Aerospace of Augsburg, Germany — majority-owned by OHB SE of Bremen, Germany — was working on a better composite production technology for the casing.

ESA governments had agreed to consider a second P120 production line pending validation of the German claims.

Since then, Germany has pressured ESA governments to accept the second production line even without confirmation that the technology would deliver on its cost-saving promise.

Germany is the second-largest contributor to the Ariane 6 program, after France, but does not have a major share in the Vega program. It was therefore up to ESA to stitch together an agreement taking account of Germany’s rights in Ariane 6, and Italy’s rights in Vega, which are both tied to the P120C program.

In a Nov. 4 interview, Neuenschwander said the Nov. 3 agreement was reached on the assumption that the production cost savings of the German technology will compensate for the increased costs of opening a second production facility.

Neuenschwander agreed that “there is an element of redundancy” in setting up a second facility, but that this is not necessarily a bad thing. If the promised savings from the German production technology do not materialize, he said, “We will reassess this in 2018.”

Final go-head on development funds set for Nov. 8

Neuenschwander said the Industrial Policy Committee decision on Nov. 8 is all but a foregone conclusion given the unanimity of the ESA council on Nov. 3.

In addition to the Ariane 6 development program and the P120C agreement, ESA’s council approved the full development of the Ariane 6 launched installation at Europe’s Guiana Space Center in French Guiana, on South America’s northeast coast.

It is not European industry, but the French space agency, CNES, that is prime contractor for the Ariane 6 launch base. Construction has begun and CNES officials have said they will be on time for an inaugural launch of Ariane 6 in 2020.

As was the case with Airbus Safran Launchers, CNES was given only a first tranche of 178 million euros of its promised funding, with the remaining 422 million euros to be withheld until matters of geographic return on the entire Ariane 6 program were settled.

Airbus Safran Launchers had been paid 688 million euros of the 2.4 billion euros covering ESA’s share of Ariane 6 development.

Neuenschwander said it should be only a matter of days after the Nov. 8 meeting until both CNES and Airbus Safran Launchers are paid the final tranches on their contracts.

Tough policy issues await in 2018

Not all issues surrounding Ariane 6 have been resolved, although the program will now enter full-scale production.

For example, the future role of ESA and European governments in maintaining Europe’s spaceport and the Ariane 6 rocket has yet to be determined. Ariane 6 represents a departure from past European practice in that industry, led by Airbus Safran Launchers, has been given full responsibility for development.

In late  2017, ESA will conduct an Exploitation Readiness Key Point, which whose conclusions will be presented to ESA’s council in March 2018. It is here that the future Ariane 6 role of ESA — and perhaps the European Commission as well — will be settled.

Among the issues: Who is financially responsible for the costs associated with a launch failure? What is the exact role of governments in the event the euro rises strongly against the U.S. dollar, compromising Ariane 6’s competitiveness? Will ESA agree to return to the current practice of topping off launch-service provider Arianespace’s annual revenue to assure it does not report a loss?

Peter B. de Selding was the Paris bureau chief for SpaceNews.