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A nuke defense silo is used to research nuclear missiles as well as protect the base they are placed in.
Missiles must be manually constructed to work right. Once at least one Anti-nuke has been built (450 Mass, 1000 Energy) it will remain stationary until a nuke comes within range, when that happens the defense silo will fire the anti-nuke at the nuke, destoring it mid-air.
Always check your enemy's base for a Nuke Defense Silo with your faction-specific airplanes. If you do this and you see one, do not fire the nuke or you will have made a very costly and time-wasting mistake. If you do see one and still want to fire a nuke, send a small army and tell them to focus soley on the Defense Silo. They will probably perish, but this will give you enough time to launch the nuke before your enemy can build a brand new defense silo and some anti-nukes to go with.
This silo also blocks against all tactical missiles fired by enemy units, and long-range artillery provided the shell comes within range of the silo. It has no porblem dealing with vertical missiles coming at it from vehicles like meteors, which cause enough damage already.
If you are playing against a Cybran army in Skirmish on normal or higher, this structure is invaluable, because cybrans always seem to get the nukes first. Sending your units is unsuccessfuly to destroy the Cybran's nuker will usually provoke them to fire a nuke, and that is where this structure comes in to play.