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  •   Missile Failures Led To Loral-China Link

    Chinese Rocket
    The failed Chinese satellite launch in February 1996. (Reuters photo)
    By John Mintz
    Washington Post Staff Writer
    Friday, June 12, 1998; Page A20

    The Chinese rocket had barely cleared the tower before it veered sideways seconds after liftoff, exploding in a fireball against the night sky. Blazing rocket fuel and chunks of the 10-story launch vehicle rained down on a nearby village, killing scores of people and destroying the $85 million U.S. satellite that was its cargo.

    The failed launch on Feb. 14, 1996, was yet another setback in China's plans for its troubled Long March rocket. One after another in recent years, Long March rockets have gone haywire seconds after takeoff, doing near-barrel rolls or loops reminiscent of the early days of the American space program in the 1950s. Some released the satellites that U.S. firms paid millions of dollars to launch into useless, oddball orbits.

    These mishaps, and the bitter post-accident recriminations that followed, set the stage for the current congressional and Justice Department investigations of Loral Space & Communications Ltd., the company whose satellite was demolished in the 1996 accident and that is being probed for allegedly turning over sensitive information to the Chinese as part of a post-crash report. Ironically, that report marked an effort by Loral to head off years of rising frustrations between U.S. companies and Chinese space officials over the repeated Long March failures.

    For years before that accident, Chinese space executives tried to cover up the causes of the errors, U.S. industry executives said. In almost every case, the Chinese denied that their Long March rockets had been at fault and blamed the Western-built satellites.

    "Until quite recently, many in the space world shared the view that the Long March was pretty shoddy, their quality control standards weren't high, and dealing with them was a dicey situation," said John Logsdon, director of George Washington University's Space Policy Institute. "It was made worse because many Westerners didn't have confidence in China's reviews."

    The Chinese rocket industry began around 1970 as an outgrowth of China's super-secret nuclear ballistic missile program. In the last 27 years, about seven of the approximately 50 Long Marches launched have suffered serious failures or satellite orbit errors -- a success rate well below the other rocket-launching programs in the world, according to U.S. experts. But precise numbers are unknown -- because, they said, the Chinese have historically covered up their space embarrassments.

    At first the Chinese rockets launched only weather and scientific satellites for China's own use. Then in 1985, China, desperate for hard currency, started marketing its rockets as vehicles to send Western satellites into orbit at a time of growing demand for TV, radio, telephone and data services.

    For the first time, the Chinese had to open up their technologies and procedures to Western investors and insurance executives who were risking hundreds of millions of dollars. The Westerners were nervous when Chinese space officials never properly explained why a number of their early launches from the Xichang launch facility, in the mountainous province of Sichuan, failed to put the satellites into the correct orbit.

    Then, in December 1992, the top portion of a Long March peeled away 45 seconds into flight, just as it was hitting supersonic speeds. The satellite inside, built by Hughes Electronics Corp. for use in Australian telecommunications, was instantly destroyed. Bystanders on the ground saw a bright flash in the sky as volatile rocket propellant in separate tanks mixed and exploded.

    Hughes and the state-controlled Chinese rocket company, China Great Wall Industry Corp., agreed that stiff winds of up to 100 miles an hour above the launch site played a role in the accident, but they disagreed about the details. The Chinese government-controlled press said Hughes's satellite was somehow responsible, but Western space executives scoffed at the suggestion. Then the two sides released statements asserting the specific cause was unknown.

    "The lack of a finding left a bad taste in the industry's mouth, and Hughes and China Great Wall committed themselves to reaching a conclusion" the next time a problem occurred, said Aviation Week & Space Technology, an industry bible on space accidents.

    Then, on Jan. 25, 1995, the top of a Long March disintegrated just as it hit supersonic speeds and encountered high-altitude winds. Again, a Hughes satellite was destroyed. This time the rocket's debris fell on villagers -- the Chinese said six people were killed, but Westerners believe the toll was higher.

    Again, Hughes privately argued bitterly with the Chinese, who blamed the company's satellite. And again, Western space experts didn't believe them. "The Chinese just kept blaming Hughes," one U.S. space executive said.

    The tensions presented a quandary for the firm. Hughes wanted to curry favor with Chinese officials in order to land other high-tech business there.

    For years, Hughes had been America's cheerleader for the Long March rocket. It told fellow U.S. satellite-builders such as Loral that they should join Hughes in launching on the Chinese rockets because their low price -- about $50 million per launch -- would force the market leader, France's Arianespace rocket company, to reduce its price of $110 million or so per ride. (A U.S. Atlas rocket costs about $100 million.)

    "It was very hush-hush between the two sides," said Marshall Kaplan, chairman of Launchspace Inc., a space consulting firm. But Hughes officials finally fought back, privately telling the U.S. space establishment that the Chinese rocket was responsible for the crash. Chinese officials "became unglued" at the company's cheek, an industry official said.

    Hughes executives couldn't defend themselves in the subsequent angry talks, industry officials said, because they knew the dangers of revealing too much U.S. technical know-how. As is the rule in such cases, Pentagon security officers monitored all of Hughes's contacts with the Chinese because straightening out China's error-prone rockets can assist its ballistic missile engineers.

    Then the Loral satellite -- Intelsat 7A -- blew up. The Chinese rocket detonated 22 seconds into flight, obliterating the hotel where Western observers had dropped off their luggage only hours before. U.S. engineers were held in a bunker for five hours before they could retrieve the melted pieces of their three-ton satellite, which was to have beamed TV shows to Latin America for Rupert Murdoch's News Corp.

    In the following days, China said six mountain villagers burned and choked to death in the cascade of flaming rocket propellant. Later they raised the estimate to 26, and then, after an Israeli engineer's tape of blazing rubble circulated in the United States, Chinese officials hiked their toll to 56. But U.S. defense intelligence officials estimate the deaths at about 200.

    China blamed the accident on a low-tech problem, the faulty soldering of a wire on a computer circuit board. But this time, skeptical U.S. and European insurers -- who ultimately paid $219 million -- demanded that a panel of independent experts review that conclusion.

    In May 1996, a Loral representative on that panel faxed Chinese space officials Loral's findings -- a breach that company superiors immediately reported to the State Department. Later, the Pentagon concluded that the information helped China's military missile effort and damaged U.S. national security. (In its defense, the firm says the Loral engineer who faxed the report, Nick Yen, first removed what he believed were sensitive passages, which the firm says indicates he thought all along it was permissible to send the report to the Chinese.)

    Now the Justice Department also is investigating whether President Clinton's decision last February granting Loral the right to launch aboard yet another Chinese rocket -- despite an objection from the Justice Department -- was made because Loral CEO Bernard L. Schwartz is the Democratic Party's largest individual donor.

    Meanwhile, a string of successful Long March launches has partially rehabilitated the rocket's name. And Western companies are showing renewed interest in the Chinese space vehicle. A Lockheed Martin Corp. satellite was launched inside a Long March recently for use by Chinese telecommunications providers, and Loral plans a similar launch in a few months -- using the controversial waiver approved by President Clinton. And within several months, Loral and Motorola Inc. will launch satellites on Long Marches to handle wireless telephone calls for their competing systems.

    But the ongoing investigation is teaching U.S. space engineers to keep their mouths shut in China.

    "It's hard for [U.S.] engineers, if they see a solution to something, not to say, 'Why don't you try this?' " Kaplan said.

    © Copyright 1998 The Washington Post Company

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