WASHINGTON — United Launch Alliance has pulled out of the Pentagon's competition to send satellites into space, a stunning move that leaves Elon Musk's SpaceX the sole bidder.

ULA's surprise announcement paves the way for SpaceX to win its first military space launch contract.

By bowing out, ULA made good on its threat to skip the competition unless it got relief from a Pentagon ban on the use of Russian rocket engines for military satellite launches. In response to recent Russian aggression, particularly Moscow's annexation of Crimea last year, lawmakers in the fiscal 2015 defense budget banned the use of Russian RD-180 rocket engines for military satellite launches after 2019.

Last month, the Defense Department refused to waive the ban for ULA, which relies on the Russian RD-180 rocket engine to power its Atlas V rocket.

The ban impacts nine of 29 RD-180 engines that ULA ordered but had not paid for before the annexation of Crimea. Five other engines approved for ULA's use by Congress last year are already assigned to other commercial or civil missions, the company has said, and are not available for use in the GPS launch competition.

"Under the restrictions imposed by the 2015 National Defense Authorization Act (NDAA), ULA does not currently have any Atlas engines available to bid and therefore is unable to submit a timely proposal," ULA spokeswoman Jessica Rye said in an emailed statement.

ULA "does not have the accounting systems in place" to certify that "funds from other government contracts will not benefit the GPS III launch mission," Rye added.

"ULA wants nothing more than to compete, but unfortunately we are unable to submit a compliant bid for GPS III-X launch services," Rye said.

However, SpaceX has argued that nothing is preventing ULA from ordering more RD-180 engines for commercial or civil missions. Then ULA could use the five engines approved last year for the GPS III competition.

ULA does build another rocket, the Delta IV, which is powered by US company Aerojet Rocketdyne's RS-68 engine.

Pentagon press secretary Peter Cook declined to comment on the source selection process during a Nov. 17 briefing. He noted that the Pentagon carefully considered whether to give ULA relief from the Russian engine ban, and decided a waiver was not necessary.

"I can't talk about a contract award that hasn't been made yet. These were considerations that [Deputy Defense Secretary Robert Work] and others looked carefully at that time," Cook said when asked about ULA's decision. "These are rules put in place by congress and we have to abide by those rules."

The Air Force's GPS III Launch Services solicitation is a crucial part of the Evolved Expendable Launch Vehicle program. Proposals were due Nov. 16.

A SpaceX spokeswoman did not comment by press time, but the company is widely expected to compete. SpaceX has invested heavily over the past few years to develop its own Merlin engine to power its Falcon 9 rocket.

Email: lseligman@defensenews.com

Twitter: @laraseligman

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