It was just Ridley losing interest in the project
Fault of Fox. Scott submissive thinking more as a producer than a director.
Fox spent more than 10 years convincing Scott for a direct Alien prequel.
Fox wanted Prometheus 1 with Alien and was disappointed but they trusted Scott ( Productors tell in 2012 that there would be no Alien now and it would not be a direct prequel BUT one day I would make a prequel direct).
Fox wanted that in Covenant and new trilogy prequels after Prometheus2/covenant and sequel Awakening ( new trilogy is a Prequel direct in planet Alien79 but only productor NOT director in last movie of new trilogy, last movie prequel direct 100%) .
Scott didn't want to.
Scott want Prometheus 2.
Scott in interviews about Prometheus 2 (before being Covenant) said that they would move away from the ALL of Alien. More than Prometheus ( original Script with Alien and planet of Alien79 but Scott dont want).
Fox wanted Alien/terror/ slasher after public division on Prometheus, Fox want more boxoffice than 400( budget 130+marketing 100). Fox Want new protagonist and less engineers, less filosofy, more action. Shaw is Prometheus. Fox desconcert with Prometheus and division audience. New protagonist like Weaver = more like Alien.Alien/weaver more in Covenant with new character.
Scott love engineers , love Promethues, David8 and script Prometheus 2 remove Alien equal in movie Prometheus.
That's why he order to rewrite the first script Prometheus to remove Alien. ( I Read script Alien:Engineers in internet, Covenant is more sequel of this script than sequel Prometheus).
And I didn't want to introduce the Alien in Prometheus 2 after deleting it in Prometheus.
Scott explain BEFORE born Covenant movie , he no want Alien in Prometheus 2 in script( tell in 2013, I read interviews). Before of rewritten Prometheus 2 to Alien Covenant it says.
Later, before the premiere, he said that he put in the Alien because the public requested.Scott changue speech on Alien in 2014 or 2015. Before , in 2013 NOT ALIEN. After in 2014 ,YES ALIEN.
After the premiere he said it was a mistake. That the Alien was worn out.
The presidenta of Fox said that it was a mistake to introduce Alien believing that it would do better at the box office than Prometheus.
Covenant is more commercial, more Alien, more terror, more Fox.Covenant is two movies. Prometheus 2 meet Alien. Movie Scott and movie studio.
Prometheus 2 was more Scott, more engineers, with the Prometheus movie formula even further from Alien. Confirmed by Scott before transforming her into the Alien Covenant and changing his speech to speak well of the Alien.
Alien not plan in Prometheus 1 and 2 becose in original script ( Alien:Ingenieros ) Scott dont like with Alien and rewrite. BUT origin Alien with David8 is posibility but not in terror/Alien movie like Covenant. Scott not want Alien/ mitology in Prometheus 2, ir says in 2013.