The rocket, launched at 0049 GMT from the northern Plesetsk space centre, suffered engine failure and plunged into a forest in the Tyumen region of Siberia, ITAR-TASS cited a spokesman for Russia's space administration, Colonel Alexei Kuznyetsov, as saying.

The rocket was to have placed satellite Molnia-3K into orbit an hour after launch.

"The rocket launched normally. The launchpad was not damaged. For 340 seconds the flight proceeded as planned, then the surveillance system lost the rocket," Kuznyetsov said.

The rocket's first section was due to fall into the northern Siberia region of Komi and its second section further east, but the second and third sections failed to separate, Anatoli Perminov, director of Russia's space agency, was cited by his press office as saying.

"Either the device for putting the third part into operation didn't respond, or the separation command was not executed," Perminov said.

The failure of the launch would not cause any environmental damage as the rocket was fuelled by a mixture of kerosene and oxygen, Perminov said.

Russian insurers had insured the launch for 190 million dollars, ITAR-TASS said.

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