diff --git a/pkg/build/extract.go b/pkg/build/extract.go
index f374fdea..33d1b672 100644
--- a/pkg/build/extract.go
+++ b/pkg/build/extract.go
@@ -2,20 +2,29 @@ package build
 
 import (
 	"fmt"
+	"os"
+	"path/filepath"
 
 	"github.com/suse-edge/edge-image-builder/pkg/log"
 )
 
-
 func (b *Builder) Extract() error {
 	log.Audit("Generating image customization components...")
 
 	if err := b.configureCombustion(b.context); err != nil {
-		log.Audit("Error configuring customization components, check the logs under the build directory for more information.")
+		log.Audit("Error configuring customization components, check the logs under the extract directory for more information.")
 		return fmt.Errorf("configuring combustion: %w", err)
 	}
 
-
 	log.Audit("Extract complete!")
 	return nil
+}
+
+func SetupExtractArtifactsDirectory(buildDir string) (artefactsDir string, err error) {
+	artefactsDir = filepath.Join(buildDir, "artefacts")
+	if err = os.MkdirAll(artefactsDir, os.ModePerm); err != nil {
+		return  "", fmt.Errorf("creating an artefacts directory: %w", err)
+	}
+
+	return  artefactsDir, nil
 }
\ No newline at end of file
diff --git a/pkg/cli/build/extract.go b/pkg/cli/build/extract.go
index aa706f96..c9adf164 100644
--- a/pkg/cli/build/extract.go
+++ b/pkg/cli/build/extract.go
@@ -56,15 +56,13 @@ func Extract(_ *cli.Context) error {
 		os.Exit(1)
 	}
 
-	combustionDir, artefactsDir, err := build.SetupCombustionDirectory(buildDir)
+	artefactsDir, err := build.SetupExtractArtifactsDirectory(buildDir)
 	if err != nil {
-		log.Auditf("Setting up the combustion directory failed. %s", checkExtractLogMessage)
-		zap.S().Fatalf("Failed to create combustion directories: %s", err)
+		log.Auditf("Setting up the extract artifacts directory failed. %s", checkExtractLogMessage)
+		zap.S().Fatalf("Failed to create extract artifacts directories: %s", err)
 	}
 
-	ctx := buildContext(buildDir, combustionDir, artefactsDir, args.ConfigDir, imageDefinition)
-
-	ctx.ImageDefinition.OperatingSystem.Packages = image.Packages{}
+	ctx := buildContext(buildDir, "", artefactsDir, args.ConfigDir, imageDefinition)
 	if cmdErr = validateImageDefinition(ctx); cmdErr != nil {
 		cmd.LogError(cmdErr, checkExtractLogMessage)
 		os.Exit(1)
@@ -92,7 +90,6 @@ func Extract(_ *cli.Context) error {
 	return nil
 }
 
-
 // If the image definition requires it, starts the necessary services, returning an error in the event of failure.
 func bootstrapExtractDependencyServices(ctx *image.Context, rootDir string) *cmd.Error {
 	if combustion.IsEmbeddedArtifactRegistryConfigured(ctx) {