BAE Systems has invested in a British firm developing an engine capable of flying passengers from London to Sydney in four hours.

Oxfordshire-based Reaction Engines has been developing a turbine that combines both jet and rocket technologies.

The revolutionary technology could allow aircraft to take off from a runway and accelerate to five times the speed of sound, before switching to a rocket mode, propelling it into orbit.

BAE has announced today that it will take a 20 per cent stake in privately-owned Reaction for £20million.

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Streamlined: Investment for the future: BAE Systems is investing in a British firm developing an engine capable of flying passengers from London to Sydney in four hours

The revolutionary design could also be used to send satellites into space at a fraction of the current cost.

At the moment, rockets have to carry liquid oxygen and liquid hydrogen to power them and the cost of carrying this heavy fuel is expensive.

The new engine creates its own liquid oxygen by cooling air entering the engine from 1,000°C to minus 150°C in a hundredth of a second – six times faster than the blink of an eye – without creating ice blockages.

This allows the engine to run safely at much higher power than is currently possible, without the risk that it will overheat and break apart.

Blast-off: Computer generated image of ground-based SABRE test engine. BAE Systems and Oxfordshire-based Reaction Engines has been developing a turbine that combines both jet and rocket technologies

The SABRE engine has a sophisticated thermodynamic cycle with heat transfer between the fluid streams

The design – known as an air-breathing rocket engine and named Sabre – could power a new generation of Mach 5 passenger jets, called the Lapcat, dramatically cutting flying times.

Mach 5 is about two and half times faster than the top speed achieved by Concorde and could be the next big leap forward in powered flight.

While normal long-haul passenger jets cruise at around 35,000ft, the Lapcat could fly as high as 92,000ft at speeds of up to 4,000mph.

Reaction Engine's Sabre design uses a system of pipes, filled with helium.

FUTURE OF FLIGHT? HOW THE SABRE JET ENGINE WORKS The Sabre engine works by burning atmospheric air in combustion chambers. It then uses the heat to turbo-charge the engine. At the moment, rockets have to carry liquid oxygen and liquid hydrogen to power them and the cost of carrying this heavy fuel is expensive. The new engine creates its own liquid oxygen by cooling air entering the engine from 1,000°C to minus 150°C in a hundredth of a second – six times faster than the blink of an eye – without creating ice blockages. This new class of aerospace engine is designed to enable aircraft to operate from standstill on the runway to speeds of over five times the speed of sound in the atmosphere. It can then transition to a rocket mode of operation, allowing spaceflight at speeds up to orbital velocity, equivalent to 25 times the speed of sound. Advertisement

The air passes through these pipes and the helium helps remove any heat and the oxygen is carried to the engine.

Once in space, the engine is capable of switching into rocket mode.

This means the craft can travel in orbit for around 36 hours and used to launch satellites, for example.

Nigel Whitehead, a BAE managing director, said: 'Our partnership with Reaction Engines is part of our sustained commitment to investing in and developing prospective emerging technologies.'

Mark Thomas, Reaction's managing director, described the development of the engine is the 'Holy Grail' of space access.

He said: 'The general public many feel removed from the notion of space, but much of our lives are reliant on the use of satellites in space.

'Because of its reusability, it dramatically reduces the cost of launching a satellite to about one tenth of the current $100 million.

'You don't buy a new car, and then when it runs of of fuel throw it away. That is what we are aiming to do with spacecraft.'

BAE will be developing an aircraft fitted with the new engine.

The team plans to produce a demonstration model by the end of the decade, although designs for passenger aircraft are still at least 20 years away.

The UK Government is expected to confirm a grant of £60million for Reaction Engines for Sabre's development towards a test engine and to investigate how it could be used to transport satellites and people into space.

SABRE (Synergetic Air-Breathing Rocket Engine) is an advanced combined cycle rocket engine with the potential to revolutionise hypersonic flight and the economics of space access

Reaction Engines claims Sabre can be used to help accelerate existing aircraft up to five times the speed of sound and plans to use the technology on a unique 3,500mph 'spaceplane' called Skylon