Australia to spend $8 billion on nuclear sub shipyard

Perth: Australia is shelling out an initial sum of AU$12 billion ($8 billion, €6.8 billion) to upgrade facilities at a shipyard as part of a 20-year plan to turn it into a maintenance centre for a future fleet of nuclear-powered submarines.

 The Australian government is pumping funds into the Henderson shipyard near Perth after a 2021 agreement with the United Kingdom and the United States — called AUKUS — to acquire the submarines.

Under the pact, the UK and the US will provide Canberra with nuclear-powered attack submarines from the next decade to tackle China's growing influence in the Indo-Pacific region.

Shipyard key to Australia's AUKUS ambitions
Australian Defence Minister Richard Marles said on Sunday that the "very significant" investment will be spent over a decade at the shipbuilding and maintenance precinct situated in Western Australia.

"Henderson is a key piece of the AUKUS story, and, from that point of view, it will be welcomed in the US, as it will be welcomed in the United Kingdom, for sure," Australia's Sky News quotes Marles as saying.

"But this is about what Australia needs to do in order to meet its strategic moment," he added.

The AUKUS deal —  which is worth hundreds of billions of dollars —  will see the US sell several Virginia-class nuclear-powered submarines to Australia, while Britain and Australia will subsequently build a new AUKUS-class submarine.

 At present, Australia has no infrastructure to service nuclear-powered submarines.

The country's center-left Labor government plans to prop up Henderson with high-security dry docks to maintain the submarines.

It will also create facilities to build landing craft for the Australian army and new general-purpose frigates for the navy, in steps that could support around 10,000 local jobs.

The Australian defence minister also said the United States would be able to use the planned defense facilities near Perth to help deliver the AUKUS submarines.

"This is about being able to sustain and maintain Australia's future submarines but it is very much a facility that is being built in the context of AUKUS," Marles told Australian Broadcasting Corporation television. "I would expect that in the future this would be available to the US."

US President Donald Trump's administration is conducting a formal review of the AUKUS pact.