Orbex has put work on its own spaceport in Sutherland on hold and will instead focus on development of rockets designed specifically for launch from Shetland rival SaxaVord.
SaxaVord, whose biggest shareholder is Danish fashion billionaire Anders Povlsen, secured the UK's first licence for vertical space launch in December 2023. The facility suffered a setback in August of this year when an engine exploded on the launchpad during a test carried out by German company Rocket Factory Augsburg (RFA), which hopes to begin commercial operations next year from the site in Unst.
Moray rocket firm Orbex took responsibility for the operational management of Sutherland Spaceport - a project originally headed up by Highlands and Islands Enterprise (HIE) - in November 2022, with construction getting underway in May 2023.
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The £20 million project had a £14.6m public investment package confirmed, including more than £9m from Highlands and Islands Enterprise. However, it had also faced objections, including those of Mr Povlsen.
Chief executive Phil Chambers said Orbex will now put more funding into development of a medium-sized launch vehicle known as Proxima, allowing the company to achieve its first launch next year. Orbex had been in the final stages of developing Prime, a smaller 19-meter-long rocket to take satellites into polar and sun-synchronous orbits.
The lease to build and operate Sutherland will be maintained by Orbex and kept under "continuous review", but Mr Chambers added that Orbex is "first and foremost" a launch services specialist.
"Our primary goal is to support the European space industry by achieving a sustainable series of satellite launches into low Earth orbit," he said. "This is best achieved by focusing our resources and talents on developing launch vehicles and associated launch services.
"This decision will help us to reach first launch in 2025 and provides SaxaVord with another customer to further strengthen its commercial proposition. It’s a win-win for UK and Scottish space.”
Frank Strang, the chief executive of SaxaVord, said the tie-up makes commercial sense.
“We're delighted to welcome Orbex to SaxaVord," Mr Strang said. "Given the scale of their ambition and the evolution of their offer to include a medium-sized launch vehicle, it makes sense for Orbex to start operations from SaxaVord Spaceport, which is already licenced and in a position to support their upcoming launches.
"The UK’s space industry is developing very quickly and requires the associated economies of scale and synergies to maintain its competitiveness for launch services from Europe."
Orbex said it is planning to increase manufacturing capability at its headquarters in Forres to ensure it can meet demand for its smaller Prime vehicle. It will now also use the site to develop the larger Proxima rocket, which will enable Orbex to send more and larger satellites into orbit.
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The company said this will better position the business to participate in the European Launcher Challenge, a competition run by the European Space Agency (ESA) to assist with development of launch capabilities for use by institutional and commercial operators. Last month, Orbex announced it had secured an additional £4.7m in funding from the ESA's Boost programme.
“Medium-sized space rockets will play an important role in the European space industry in years to come," Mr Chamber said.
"It is part of our strategic plan to offer the market a medium-sized launcher that will compete in Europe for larger payloads. Pausing the construction of our own spaceport enables us to now focus on developing this offering.”
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Orbex, which employs 200 people at its operations across Scotland and Denmark, said it will be consulting with the three staff employed on its spaceport project to identify options for relocation or new roles.
“While we appreciate this news means pausing the construction plans at Sutherland, we are still committed to the north of Scotland at our facilities in Forres and we look forward to building our presence at SaxaVord in Shetland as well," Mr Chambers said.
"The decision to pause construction was not taken lightly. We are incredibly grateful to the Sutherland community for being so supportive of our initial plans to build our first spaceport there.”
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