Jia Lissa
Sally Schultz believed she had found her sanctuary, a hard-won slice of stability for her family in the quiet expanse of Rio Rancho Estates, New Mexico. After a divorce, the single mother of four invested her savings, a modest $3,500, into a half-acre plot in this unincorporated, census-designated community. Here, she cultivated a vibrant homestead, coaxing corn, squash, and green chile from the arid soil, transforming cheap land into a personal haven. This dream, however, now teeters on the precipice of an unforeseen and potentially catastrophic development: the construction of a massive hypersonic missile manufacturing facility, Castelion’s Project Ranger, mere yards from her doorstep.
A Community on the Brink of an Industrial Hazard
The tranquility of Rio Rancho Estates has been shattered by the looming presence of Castelion, a defense technology startup founded in November 2022 by three former SpaceX executives. Project Ranger, hailed by the company as "America’s largest dedicated hypersonic manufacturing production facility," is rapidly taking shape. Its construction, anticipated to conclude by year-end, has placed approximately 450 properties, including Schultz’s, alarmingly close—in some instances, little more than 1,000 yards—to a site designed to store and produce highly volatile materials. This proximity places thousands of residents squarely within a designated danger zone, vulnerable to the catastrophic consequences of a chemical fire or explosion.
“We’ve already been through so much,” Schultz laments, her voice heavy with apprehension. “And now we have to leave. It is the unknowing that is scariest.” Her sentiment echoes through the community, where residents like Laura Lundberg voice profound unease, stating, “I live next door to where World War III will be manufactured.” Their fears are not merely speculative; they are underpinned by official hazard assessments and a disturbing lack of transparency from Castelion, a company that has declined to engage with the press regarding this unfolding crisis.
Castelion’s Rapid Ascent in the Defense Sector
Castelion has quickly emerged as a formidable player in the burgeoning defense tech landscape. In a remarkably short span, the company has achieved a staggering valuation of $13 billion, quadrupling its Series B valuation of $2.8 billion from the previous year. This meteoric rise is fueled by substantial government contracts, with over $500 million secured from the US military in just 18 months. Such rapid investment has solidified Castelion’s position as a key supplier within the nation’s "Arsenal of Freedom" initiative, a strategic push to bolster domestic defense manufacturing capabilities.
The company’s flagship product, the Blackbeard, is a solid-rocket-powered hypersonic missile designed to travel at speeds exceeding five times the speed of sound. Castelion initially touted Blackbeard’s cost-effectiveness, proposing a unit price of $384,000—a stark contrast to the US Army’s Dark Eagle, which costs an estimated $41 million per missile. However, the reality of defense manufacturing, particularly for advanced technologies, often deviates from initial projections.
The Escalating Cost of Hypersonic Ambition
A closer examination of Castelion’s contracts reveals a significant escalation in the Blackbeard’s per-unit cost. The year commenced with a nearly $50 million Navy contract for full-scale prototypes. By June, this expanded with an additional $23.4 million for the first 50 operational prototypes. August brought another $90 million for manufacturing services for the same 50 missiles, pushing the total expenditure for these units to $163.4 million, or approximately $3.3 million per missile. Most recently, in September, the Navy awarded Castelion its largest contract yet, potentially reaching $200 million. While still substantially cheaper than the Dark Eagle, Blackbeard’s cost has grown almost nine-fold from its initial advertised price, underscoring the complexities and expenses inherent in scaling advanced defense production.
Despite the significant financial investment and the recent release of Blackbeard’s first official photo, concrete performance figures and test data verifying the weapon’s efficacy remain conspicuously absent from public discourse. This lack of transparency regarding both cost and capability raises questions about the due diligence involved in such substantial military procurement. Project Ranger, a sprawling 1,000-acre facility, is envisioned as Castelion’s primary manufacturing and testing hub, with mass production slated to begin as early as next year.
A Troubling Chronology: From Nevada Rejection to New Mexico’s Embrace
The genesis of Project Ranger in New Mexico is marked by a peculiar and somewhat clandestine journey. The facility wasn’t always destined for the Land of Enchantment. In August 2023, under the guise of "Pallas Industrials," Castelion submitted an application to construct a rocket factory in Churchill County, Nevada. The application, signed by Chief Financial Officer Andrew Kreitz, outlined plans for rocket motor production and ground-testing up to eight days a month. Nevada officials, in response, issued an eight-page staff analysis demanding detailed testing conditions and safety protocols—requirements that seemingly led Pallas Industrials to withdraw its application and resurface as Castelion in New Mexico a few months later.
By the spring of 2025, Rio Rancho Estates residents began noticing soil-probing trucks, an early indicator of the industrial behemoth to come. Unbeknownst to them, Castelion was already deep in discussions with New Mexico officials regarding the land. This timeline suggests a deliberate strategy to circumvent stringent regulatory hurdles encountered elsewhere, leveraging New Mexico’s eagerness to attract high-tech industry.
The Unredacted Truth: Sandia’s Dire Hazard Assessment
A pivotal document in this unfolding saga is a hazard report delivered in June 2025 by Sandia National Laboratories, part of the New Mexico Small Business Assistance Program. This program, designed to provide local businesses with expert assistance from national labs, inadvertently brought to light the severe risks associated with Project Ranger. Initially released under the Freedom of Information Act as a heavily redacted document, a technical oversight—black ink highlight over black text instead of scrubbing the underlying data layer—allowed the full, unredacted report to be accessed through simple copy-pasting.
The unredacted Sandia report paints a chilling picture of potential dangers. It identifies a “massive storage facility fire” as the worst-case scenario. Castelion’s plans include storing colossal quantities of propellants, specifically up to 250,000 pounds of ammonium perchlorate—a heat-sensitive chemical oxidizer—in covered magazines and bunkers. Furthermore, the hazardous integration facilities are permitted to house up to 81,000 pounds of active explosive material during the assembly process.
Sandia’s calculations revealed that a detonation of the maximum allowed explosive material would necessitate a buffer zone of nearly nine football fields from the nearest inhabited structure. Even more alarming, a worst-case explosion could shatter large windows almost four miles away and carry a 3.2 percent chance of causing minor eardrum damage to individuals 400 yards from the detonation point.
Beyond explosive risks, the report identified a fire at the test stand as “the most probable foreseeable hazardous event.” Such a chemical blaze would unleash a toxic plume containing hydrogen chloride and chlorine gases. These highly corrosive substances can cause severe burns to eyes, skin, and respiratory tracts, with short-term inhalation at high concentrations potentially leading to chemical lung damage and asphyxiation. The severity of these risks led the Rio Rancho Fire Department, as revealed in public records, to determine that 17 of Project Ranger’s 26 buildings would be left to burn in the event of a fire, with first responders barred from entering high-risk facilities due to the extreme chemical hazards.
A Pattern of Industrial Accidents and Delayed Safety Protocols
The dangers highlighted by the Sandia report are not theoretical. Recent incidents in the defense and chemical industries underscore the very real risks of such operations. WIRED previously reported on a June incident at Anduril’s Mississippi facility, where a test run of an ammonium perchlorate-based rocket motor culminated in an explosion, narrowly avoiding casualties but demonstrating the inherent volatility of scaling solid propellant production. Similarly, in May, an overheating storage tank at a GKN Aerospace plant in Garden Grove, California, containing 7,000 gallons of flammable methyl methacrylate, necessitated the evacuation of over 40,000 residents.
Despite these stark warnings and the advanced stage of construction, internal emails obtained through public records requests expose a disturbing lack of finalized fire-response requirements. Between March and May, Castelion was actively negotiating critical fire safety standards with the city, even as construction was already underway. Bryce Barlow, Castelion’s site developer, acknowledged on March 23 that the company had not yet finalized the fire-flow response. This critical issue was then seemingly sidestepped, with City Manager Matt Geisel replacing hard numbers with a statement that details would follow, requiring only a signed memorandum of understanding to proceed. Castelion CFO Kreitz’s response – “Great news! Saves all of us both legal bills and headaches” – speaks volumes about the priorities at play.
Political Endorsement and the "Done Deal"
The rapid progression of Project Ranger was significantly aided by robust political backing and generous economic incentives. In August 2025, prior to Castelion’s formal announcement, Republican State Senator Jay Block, whose district now includes Rio Rancho, publicly advocated for financing Project Ranger before the Sandoval County Commission. The commission responded by approving $125 million in industrial revenue bonds and granting Castelion an astounding 95 percent discount on property taxes. Furthermore, the county agreed to abate compensating taxes on out-of-state equipment, substantially lowering the relocation costs for the incoming missile manufacturer.
“I strongly supported Project Ranger as it moved through the local approval process, because I believed Rio Rancho and Sandoval County had the workforce, infrastructure, and defense heritage to help Castelion succeed,” Senator Block stated to WIRED, highlighting the perceived economic benefits.
However, for residents, the process felt opaque and predetermined. “All of this happened behind the scenes. By the time it was public, it was already a done deal,” remarked Zachary Darden, a Rio Rancho resident who unsuccessfully campaigned for mayor on a platform opposing the development. The sentiment of being sidelined was further exacerbated by the exclusive nature of Castelion’s groundbreaking ceremony in January. While local residents were notably absent, the event was attended by a roster of New Mexico’s most prominent political and business figures, including US Senator Martin Heinrich, then-Mayor Gregg Hull, Governor Michelle Lujan Grisham, and various state and county economic development officials. Rob Black, New Mexico’s secretary of economic development, lauded the project as a testament to what "a strong public-private partnership can deliver for a local community."
The Broader Implications: A Community Trapped Between Progress and Peril
For the low-income residents of Rio Rancho Estates, the "done deal" represents an agonizing dilemma. The land, once an affordable refuge, now carries the burden of potential environmental and safety hazards, making relocation a financially daunting, if not impossible, prospect. “This land is affordable for people who need it,” Jason Clifford, a community member, observed, expressing the profound sense of betrayal felt by many. “We were sold out by our local officials.”
The Castelion saga in Rio Rancho Estates serves as a stark illustration of the complex interplay between national security interests, economic development aspirations, and the welfare of local communities. The rapid expansion of defense technology companies, often operating with significant governmental backing and urgency, can lead to a circumvention of traditional regulatory oversight and public participation processes. The reliance on heavily redacted reports and the negotiation of critical safety standards mid-construction highlight a disturbing trend where the imperative for rapid industrialization appears to outweigh robust public safety and environmental considerations.
This case underscores the vulnerability of unincorporated, low-income communities, which often lack the political clout, financial resources, or legal infrastructure to effectively challenge powerful corporate and governmental interests. As Project Ranger moves closer to full operation, the residents of Rio Rancho Estates are left to grapple with an uncertain future, their dreams of stability now overshadowed by the perilous promise of hypersonic defense and the unsettling reality of living next to a potential industrial disaster. The question remains: at what cost does the "Arsenal of Freedom" come, and who ultimately bears the burden of its construction?
