Australia, France Sign $35.5 Billion Submarine Contract

BAE Systems Australia CEO Gabby Costigan and Minister for Defence Christopher Pyne are seen during a visit to a shipyard in Adelaide

Under the IGA, the 12 subs, save for some specialized parts, will be built in Adelaide in South Australia, home to the Australian Submarine Corporation (ASC).

For the record, it has been reported that these submarines stand as a major pillar of the Australian government's National Shipbuilding Plan $90 billion, under which around 54 naval vessels will be constructed in Australia. "This agreement will create around 2,800 jobs for Australians, while helping to protect our country and keep Australians safe", Christopher Pyne said on Twitter.

The 50-billion-Australian-dollar (35.5 billion USA dollars) contract will see Naval Group design and build 12 new attack class submarines for the Australian Navy, with the first to be battle-ready as early as 2034.

In 2016, France won a tender for the construction of 12 new-generation submarines for Australia, beating Japan and Germany.

• opportunities and long-term planning certainty for industry, allowing Australian companies involved in the submarine program to invest in the capabilities needed to support their involvement in construction and sustainment activities.

• Pre-sizing of the Future Submarine has been completed.

The Feasibility Study phase of the Future Submarine design contract being undertaken in France with the support of Australian engineers has been completed.

First sod has also been turned at the Future Submarine construction yard in Adelaide. The next group of engineers will depart for France in March 2019.

The Australian Broadcasting Corporation (ABC) in December 2018 reported that Naval Group had made "unprecedented" requests during SPA negotiations, including asking for a 25 percent cost blowout allowance and a two-year extension.

According to Naval Group, suppliers of the top five pieces of equipment - the main motor, diesel generators, switchboards, batteries and weapons discharge systems - have been reviewed and will be announced this year.

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