Personally, I'm much more interested in their work on the methane engine for the Air Force to replace the Russian-built RD-180 on the Atlas V... I can see a LOT of uses for a big methane burning engine (and getting the experience will put them in the catbird seat to develop smaller, say ORION-SM size methane engines, or Mars ascent vehicle methane burning engines, in the future.
As blackshire would doubtlessly point out, there's a LOT of advantages to the methane burning engines. First, methane is NON-COKING, which makes reusability of methane engines MUCH easier than with kerosene engines. (Kerosene "cokes" up the coolant tubes in the engine combustion chamber and bell nozzle when the engine shuts down, because when the kerosene stops flowing, the extremely hot combustion chamber and nozzle rapidly start boiling the kerosene sitting in the thin nozzle/chamber wall tubes, or thin channel wall nozzle/chamber, and as the kerosene boils off it creates a "crust" of carbon "coke" (like coal "coke") that adheres to the inside of the tubes and channel wall, which builds up and can impede flow or create "hot spots" the next time the engine is fired, and builds up over time. Of course the Merlin, being a kerosene burner, is susceptible to this as well, but apparently SpaceX has it licked-- think I read somewhere that they purge the engine nozzle cooling tubes with ammonia to eliminate coking??) Methane, although it has a much lower boiling point, does not create coking residue in internal engine parts and doesn't require a secondary purge system and operating fluid (like ammonia or whatever) to prevent coking.
Second, methane, despite being the lightest of the hydrocarbon fuels (1 carbon atom surrounded by four hydrogen atoms) is MUCH denser than hydrogen itself, making it a good fit for first-stage propulsion. Due to the "heaviness" of the carbon atoms, the peak exhaust theoretical velocity is lower, thus the ISP is lower than hydrogen (whose lightweight atoms accelerate rapidly and much more energetically in chemical reactions, leading to the highest theoretical ISP's of common chemical rocket fuels, which is why hydrogen is SUCH a good propellant on upper stages, despite the low density and enormous fuel tanks required to hold it). On first stages, all-out ISP is less important than sheer raw thrust, and keeping the size of the stage as small as possible to reduce vehicle size and mass. Kerosene tanks are usually pretty small volumetrically compared to the oxygen tanks for kerolox first stages; methane tanks would be larger than an equivalent energy kerosene tank on such a stage, but not RADICALLY bigger like a hydrogen tank would have to be, which is MANY times larger than the LOX tank on a hydrolox powered vehicle stage.
Third, methane, while a cryogenic liquid, is a "low cryogen" like liquid oxygen. Both are liquids at broadly similar temperatures, and easier to store and maintain as liquids with less boiloff. Liquid hydrogen, on the other hand, is a "deep cryogen" with a temperature as a liquid FAR colder than liquid oxygen, which creates a plethora of problems due to the difference in temperature of the two propellants. Oxygen can be frozen solid by liquid hydrogen, so the two tanks must be carefully insulated from each other (especially on common bulkhead tanks) and of course the much "warmer" LOX will cause LH2 to boil off at high rates if they're not properly insulated from one another. LH2, due to its EXTREMELY low temperatures (-423 degrees F) creates a lot of headaches for vehicle designers and ground handling problems, due to the formation of liquid air (free liquid oxygen and liquid nitrogen, which can explode or cause extremely severe fires) if propellant lines and surfaces are not properly contained in vacuum or insulated. Additionally, the incredibly small hydrogen molecules (H2) are inordinately difficult to seal and contain in the propellant tanks, lines, valves, and system, and quite prone to leaks. LO2 at -297 degrees F, and LCH4 at -258, cannot form liquid air and are close enough in temperature that it is much simpler to insulate the two different temperature propellants from each other, especially across common bulkheads. The larger LO2 and LCH4 atoms are also less prone to leakage and much easier to seal, and both are common "industrial gases" that are handled much more easily in their liquid state than LH2. LCH4 (Liquid methane, also known as "LNG" or liquid natural gas) is easily and commonly handled and shipped around the world on LNG tankers, so it can be handled by commonly available "off the shelf" ground handling equipment and storage tanks, which are MUCH more common than the exotic and specialized equipment required to handle LH2.
I'd be a LOT more impressed if they fielded a large orbital-capable booster using an LNG/LO2 reusable first stage and LNG/LO2 disposable upper stage, based perhaps on their BE-4 engine they're developing for the Air Force Atlas V. It'd be the "next evolution" up the ladder from the Falcon 9, with its kerosene burning Merlins. (Well, maybe more of a "convergent evolution" of the same idea). At any rate, it'd be MUCH more impressive than some little reusable sounding rocket or uber-rich suborbital hop rocket so they can blow $200,000 for five minutes of weightlessness.
As for "independent of NASA/gubmint launch sites", well, SpaceX is building their own launch site on South Padre Island just off the Texas coast near Brownsville, so they were there first as well. LOL:) SpaceX already has their McGregor, TX test site (which I've attended a rocket launch in a nearby field there years ago in MacGregor; in fact we witnessed a Merlin test firing during the day's activities!
Later! OL J R
My MUNIFICENCE is BOUNDLESS, Mr. Bond...