Orbital UAV (ASX:OEC) expects to engage in further contract negotiations with one of the fastest growing defence companies in the world, Anduril Industries, to take its prototype engines into flight with production-ready propulsion systems.

This announcement comes after the company signed a new engine development contract with Anduril worth $3 million.

Additionally, Orbital will begin development of a new, larger engine configuration for Anduril’s future propulsion requirements.

The company reports that these first prototype engines are expected to be supplied to Anduril for ground testing by January 2024. Both companies will engaging with one another regarding technical requirements for the first prototype engines.

Orbital UAV provides integrated propulsion systems and flight critical components for tactical uncrewed aerial vehicles (UAVs).