Orbex suspends Scottish spaceport in blow to Highlands ambitions

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Rocket-maker Orbex is suspending development of a spaceport in the Scottish Highlands and will move launch operations to a rival site run by SaxaVord in the Shetland Islands. 

The Anglo-Danish company will halt construction at the Sutherland site, which has received more than £10mn in public funding since 2018, in order to focus on investment in two rockets, it said on Wednesday.

However, the company may resume development of Sutherland within the next three years, said Orbex chief executive Phillip Chambers.

“The UK needs more than one launch site,” he told the FT. “Should everything go to plan, we will need more capability. Sutherland will be the number one place where we would like to develop that capability.”

Orbex’s decision leaves SaxaVord as the UK’s only site in the race to be the first European base to launch a satellite into orbit next year.

Spaceport Cornwall, which had been hoping to host a launch site in the south-west of England, has struggled to find new customers after Virgin Orbit collapsed into bankruptcy following its failed launch in 2023.

Andøya spaceport in Norway was granted its launch site operator licence in August and is planning to launch its first satellites into orbit next year.

Successive UK governments since 2014 have tried to develop a handful of commercial launch sites in a bid to tap into the new space economy emerging in low Earth orbit, or LEO.

Low Earth orbit, defined as the region of space 2000 kms above the earth, is particularly suited to services such as low latency broadband, climate monitoring and imaging.

Launches from northern Scotland can put satellites into polar and near polar orbits, providing services over the Arctic regions.

Orbex, which is in the midst of a new funding round expected to total more than £40mn, said it was pausing construction at Sutherland in order to focus on the development of its Prime micro-rocket and of a new larger launcher called Proxima, to meet expected European demand.

Chambers said Orbex had developed Sutherland far enough that construction could be resumed when needed and government money had not been wasted.

Orbex had received just £2.3mn in public funding to develop the spaceport since taking a 50-year lease on the site in 2022. “It is our intention that this is not the end of the story for Sutherland,” he added. 

The company also planned to expand its rocket factory near the Sutherland site, which would be a “significant investment”, Chambers said. 

However, the decision to suspend development has stunned local officials, who had counted on the venture to develop highly paid and skilled jobs in the remote and mountainous region.

Highlands and Islands Enterprise, an economic development promotion body that had provided substantial funding for the Sutherland spaceport over the years, expressed its disappointment at Orbex’s “unexpected change of direction”.

The UK Space Agency, which has helped to fund the development of both Sutherland and SaxaVord, insisted the decision was not a blow to the country’s space ambitions.

It welcomed Orbex’s decision to expand its rocket-making facilities east of Inverness at Forres, and said it was “good news for SaxaVord, which is the first vertical launch spaceport in Europe to receive a licence”.

In total the government has invested £65mn, directly and through the European Space Agency, to help the development of both Sutherland and SaxaVord, including awards to launch operators.

Development at the Sutherland site has been fraught with difficulty. The project was delayed for years by environmental concerns, including from SaxaVord investor and Asos founder Anders Holch Povlsen. Only recently the company announced it would have to tweak an innovative floating road designed to protect the peatlands over which it ran. 

Frank Strang, chief executive of SaxaVord, said it made sense for Orbex to launch from his spaceport. SaxaVord was “already licensed and in a position to support their upcoming launches”, he said. “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.”