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A group of New Zealand entrepreneurs is aiming high.

Auckland company Rocket Lab is preparing to launch a suborbital rocket capable of shooting 150km in space.

It has designed the rocket, due to be launched in September next year, for use in scientific research looking at micro gravity, solar physics and climate change.

Business development manager Mark Rocket (who changed his name by deed poll) said New Zealand was the perfect place to set up a rocket launch because of its clear air space and favourable regulatory environment.

The 5.5m carbon-fibre rockets, named Atea, or "space", will also be available to launch human ashes into space - for a fee.

Mr Rocket, a Christchurch internet entrepreneur and space enthusiast, and Peter Beck are behind the company.

"New Zealand has a golden opportunity to be a space industry leader in the Southern Hemisphere," said Mr Rocket, who declined to say where the rockets would be launched.

Graphics produced by the company indicated a launch pad on the south-eastern coast of the South Island.

Economic Development Minister Trevor Mallard praised the venture for its creativeness and spirit, and the potential for its efforts to open up new opportunities for the aviation sector.

Mr Mallard said commercial opportunities in the space industry were growing with American space agency Nasa contracting out much of its work globally to private providers.

"Our aviation industry has grown substantially and now represents an important and thriving industry sector in its own right," he said at the company's opening function in Auckland.

"The entrepreneurs behind Rocket Lab want to deliver pioneering technology and specialised components to the international space industry," he said.

Creation of a respected sub-orbital space industry in New Zealand could provide opportunities for New Zealand's aviation sector, and associated technology and component suppliers.

"To compete internationally, New Zealand needs to move up the value chain and create high-value spin-off industries," Mr Mallard said.

Mr Rocket has attracted publicity as the first New Zealander to buy a ticket for a space trip.

His journey - for which he has paid $300,000 - is scheduled for 2009, from the Mojave Desert on an eight-person spacecraft owned by Virgin Galactic.