A South Korean rocket carrying a climate observation satellite apparently exploded 137 seconds into its flight early Thursday, the country’s second major space setback in less than a year.

The two—stage Naro rocket operated normally during and after liftoff from the country’s space centre, Minister of Education, Science and Technology Ahn Byong—man said. But then communications with the rocket were lost.

“We believe that the Naro rocket is likely to have exploded,” he told reporters. “We are sorry for failing to live up to people’s expectations.”

An image from a camera aboard the Naro brightened like a flash of light, possibly evidence of an explosion, Mr. Ahn said.

He said South Korean and Russian experts were trying to find the cause of the problem. The first stage of the rocket was designed and built by Russia and the second by South Korea.

No report of injuries

Mr. Ahn said that South Korea will begin preparations to announce a new launch date as soon as the cause of the setback is determined. It was not immediately clear where any debris from the rocket fell and there were no reports of injuries. Repeated calls to the ministry and the state—run Korea Aerospace Research Institute went unanswered later on Thursday.

The blastoff at the coastal space centre in Goheung, 290 miles (465 kilometers) south of Seoul, was the country’s second launch of a rocket from its own territory. In the first attempt last August, the satellite failed to reach orbit because one of its two covers apparently failed to come off after liftoff despite the rocket launch itself being considered a success.

Since 1992, South Korea has launched 11 satellites from overseas sites, all on foreign—made rockets.

The launch was originally scheduled for Wednesday, but was delayed a day because fire retardant suddenly sprayed from three nozzles set up near the launch pad to extinguish any blaze.

South Koreans are intensely proud of their country’s rise from devastation and poverty after the end of the Korean War as well as their reputation for advanced technology and were closely observing the launch. About 100 people watched it on big screen televisions at Seoul’s main railway station. People applauded when the rocket blasted off, though the mood turned anxious after the first news of a problem.

Indigenous space launch vehicle by 2020

South Korea’s Ministry of Education, Science and Technology, which oversees the space programme, says South Korea plans to develop a space launch vehicle with its own technology by 2020.

China, Japan and India are Asia’s current space powers. Japan has launched numerous satellites while China sent its first astronaut into space in 2003 and carried out its first spacewalk in 2008.

India launched a satellite into moon orbit in 2008, but had to abandon it nearly a year later after communication links snapped and scientists lost control of it.

Despite the series of problems, South Korea wasn’t about to give up.

“We will make further strenuous efforts to realize the dream of space power,” said Mr. Ahn, the science minister.