Australian government to invest $3.9 billion in Submarine Construction Yard

The federal government will invest $3.9 billion as a down payment to deliver the new Nuclear-Powered Submarine Construction Yard (NPSCY) in Osborne, SA.

In a media release on 15 February Prime Minister Anthony Albanese and South Australian Premier Peter Malinauskas said that while the design process continues, significant investment is critical to delivering Australia’s conventionally-armed, nuclear-powered submarines on time. The program is projected to create nearly 10,000 jobs across the entire program in South Australia alone.

“Investing in the Submarine Construction Yard at Osborne is critical to delivering Australia’s conventionally-armed, nuclear-powered submarines,” said Prime Minister Albanese.

“South Australia is at the centre of one of the most significant defence undertakings in our history,” added Deputy Prime Minister and Minister for Defence Richard Marles. “Osborne will be critical to Australia’s nuclear-powered submarine program under AUKUS, while supporting continuous naval shipbuilding and sustainment.

“From construction of the submarine yard to delivery of critical infrastructure and the development of a skilled workforce, progress is accelerating,” he said. “The transformation underway at Osborne shows Australia is on track to deliver the sovereign capability to build our nuclear-powered submarines for decades to come.”

“The whole of the Osborne South Shipyard required one and a half million work hours to construct,” said SA Premier Peter Malinauskas, speaking in the construction hall for the RAN’s Hunter-class frigates at Osborne South. “The NPSCY will take 66 million work hours. This facility has 55,000 cubic metres of structural concrete. The new facility will have 710,000. Structural steel, much of which will be sourced from Whyalla, 9,400 tonnes in this whole precinct. In the new facility, 126,000 tonnes. So, we are talking about many multiples of the amount of work and the amount of materials that will be required to build the world’s most advanced nuclear submarine construction yard.”

Australian Naval Infrastructure (ANI) Pty Limited, which owns the land and will own the NPSCY itself, projects an estimated projected investment of $30 billion over coming decades to build the yard on the Le Fevre Peninsula, adjacent to the existing submarine and surface ship construction yards.

The NPSCY will comprise three substantive areas, including fabrication, outfitting and a further area for consolidation, testing, launching and commission. This investment complements the existing Collins-class sustainment facilities at Osborne North (ONS-N) and the Hunter-class shipyard at Osborne South (ONS-S). The total floor area of the NPSCY is expected to be 10 times larger than the existing Osborne South project.

“Importantly, this will modernise Aussie manufacturing as we go through it,” said Pat Conroy, Minister for Defence Industry. “We’ve got 70 companies already going through the qualification process to win work, supplying not just Australian submarines, but UK and US submarines, and I announced late last year that Pacific Marine batteries just down the road, which already supplies batteries for the UK Astute submarines, will be supplying batteries for SSN AUKUS.”

Enabling works and the Skills and Training Academy (STA) are expected to cost approximately $2 billion and more than $500 million respectively. Work on the STA Campus began in 2025, with the first students of the Skills and Training Academy to commence in 2028 ensuring a pipeline of skilled workers for decades to come. This Campus will be designed to support up to 1,000 learners each year.