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Thu 2 Aug 2007 09:26 AM

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Space dust

Branson's dream of tourists in space has been shattered by a tragic accident. Is it the end for the commercial space tourism industry?

Exactly fifteen months ago, Virgin Group founder Sir Richard Branson was in boisterous mood as he prepared for a press conference at Dubai's Emirates Towers hotel. Flanked by his long-time colleague Will Whitehorn, the duo were about to unveil the first ever UAE resident to go into space, Namira Salim.

But even before the conference began, Branson's Virgin Galactic company, formed to take tourists into space for US$200,000 a go, was on a roll. A South African man had literally wondered into the hotel waving a cheque for US$200,000, begging to be on board one of the first flights.

"We have sold so many seats, and we are still two years away from the first flight. It doesn't get much better than that," Branson told Arabian Business at the time.

When you embark on such a project you have to face up to the possibility of there being major setbacks and risks, and even tragedies, along the way.

And it probably won't. His entire commercial space tourism dream is in tatters, following a tragic explosion on a rocket test pad at the Mojave Air and Space Port in the California desert where Virgin's equipment was being tested. Three workers died, several others suffered serious injuries, and nobody can guarantee whether Virgin Galactic will ever make it into space.

So far, Branson has invested US$600m into the venture and taken a staggering US$200m in advance ticket sales. The marketing of the project has been sensational even by Virgin standards, and until the accident, it appeared that nothing could go wrong.

Branson had teamed up for Virgin Galactic with the legendary space pioneer Burt Rutan, head of Scaled Composites. Three years ago Rutan developed the craft SpaceShipOne which made it into space. His reward was a US$10m prize and a contract to build Branson a fleet of spacecraft. He followed up with SpaceShipTwo which will carry up to six paying tourists into space - sending them 62 miles above the earth and experiencing weightlessness for five minutes.

Test flights were due to start next year and commercial flights - with Branson and his family on board the first flight - in 2009.

So will that ever happen now? In an official statement, Virgin Galactic passed on its condolences to the families of those killed, but said it would not comment on the future of its space programme until a full investigation was complete. Privately, Virgin Galactic fears the dream may turn to dust. "We are by no means saying this is now all over - far from it. When you embark on such a project you have to face up to the possibility of there being major setbacks and risks, and even tragedies, along the way," says one senior Virgin Galactic executive.

But the same executive also admits that the company's fate is no longer in its own hands. The company's investigation into the incident could take nearly two months, but before then, a separate inquiry by NASA may decide to revoke Virgin Galactic's licence to develop rockets at the base. Given the growing speculation that some parts of SpaceShipTwo were based on the same design as the doomed Challenger Space Shuttle, that remains a strong possibility.

"We are not going to call time on this, at least not until we have thoroughly investigated what happened. But if NASA steps in then obviously that kind of decision is out of our hands," says the executive.

Virgin Galactic is not the only company attempting to make commercial space tourism a viable business - American billionaire George French; Canadian tycoon Geoff Sheerin and US businessman Chirinjeev Kathuria have also joined Branson in the same dream, and all three are watching events closely.

In the Middle East, Branson has been battling with Space Adventures to capture a slice of the lucrative market. Earlier this year, Virgin Galactic paraded Sharaf Group founder Ibrahim Sharaf as the first UAE national to have signed up for a space trip. Sharaf's own company Sharaf Travel was given the exclusive rights to market the venture in the Middle East.
In the past three months, five Middle East individuals have paid up for a trip to space.

In addition to Sharaf and Salim, two more are UAE nationals while the other is described as a "male member of a Gulf royal family", according to Virgin Galactic's Middle East spokeswoman. She adds: "As far as we are concerned here it is business as usual, we haven't been told to stop selling tickets.

"On top of the five I have already sold, I have nearly US$4m worth of serious interest, and two other people are very interested in chartering the whole spaceship for themselves and their friends.

"The interest in this region has been nothing short of phenomenal and I'm not aware of any reason why we won't go ahead on time."

Regardless of Virgin Galactic's problems however, Space Adventures has carried on with a near US$200m investment into a space port based in Ras Al-Khaimah.

I favour competition but only when it exists. You shouldn’t sell people dreams that don’t work.

The company says it will be funded by various parties, along with shared investments by Space Adventures and the government of Ras Al-Khaimah. Also, His Highness Sheikh Saud Bin Saqr Al Qasimi, along with the UAE Department of Civilian Aviation, have granted clearance to operate sub orbital space flights in their airspace.

"Since we made the initial announcement last month of our partnership with His Highness Sheikh Saud and the development of a space port in Ras Al-Khaimah, we have received thousands of enquiries from individuals in the Gulf region, specifically the UAE, who are interested in commercial space flight and want to fly," says Eric Anderson, president and CEO of Space Adventures.

A spokesman for Space Adventures says the company was "monitoring" developments at Virgin Galactic, but adds: "We are talking about two totally different kinds of technology that are being used here.

"To be specific, one has been tried and tested and the other - which led to the accident - is in the development stage. This doesn't directly affect us, but if it raises questions over general safety and maybe puts people off the whole idea, then obviously it is something we are concerned about."

Anderson has already claimed that another UAE national, Adnan Al Maimani, will actually be the first Emirati in space - thanks to Space Adventures. Despite the Virgin Galactic tragedy, it's not hard to see why companies are keen to keep chasing the dream.

Anderson's Space Adventures has charged US$20m a go to fly into space. It has also brokered a deal with the Russian Soyuz Aircraft to board the International Space Station for another US$10m. And Space Adventures is working on the possibility of taking tourists to the moon, for US$100m a head.

Just last month, EADS - which owns Airbus - announced its own commercial space tourism project.

The company said it planned to build a craft to carry people outside the earth's atmosphere from 2012 as long as they were prepared to pay up to US$268,000 for a ticket.

The idea was panned by European Commission Vice President Gunter Verheugen who said this "very privileged type of tourism" was only for the super-rich and certainly deserved no support.

This week, EADS said it was "awaiting the results of the Virgin Galactic investigation" before it could comment further.

While the industry is predicted to be worth US$20bn year by 2015, should it get going, the main players have been mostly dismissive of each other.

Last year, Branson told Arabian Business: "A lot of companies around the world are now offering space travel, but no one else has made the same progress as us. People have to be careful about paying deposits. I don't want to name any companies, but we have surely looked at all the different kinds of technology. We looked at Russian technology and we dismissed it. We looked at a lot of US technology, and we dismissed it."

His Virgin Galactic president Will Whitehorn is even more disparaging of the claims coming out of Ras Al-Khaimah and Space Adventures, adding: "They haven't actually built a system that works. It has never flown.

"It is a plywood mock-up in the middle of Ras Al-Khaimah. I favour competition but only when it exists. You shouldn't sell people dreams that don't work."

Those words may yet return to haunt him.

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