Australia has announced an initial investment of 3.9 billion Australian dollars (approximately $2.8 billion) as a first step toward constructing a new nuclear submarine shipyard under the AUKUS security partnership with the United Kingdom and the United States.
The AUKUS agreement is designed to equip Australia with a fleet of advanced US-built nuclear-powered submarines while also fostering cooperation on a broad range of defense technologies. Deliveries of the submarines are expected to begin in 2032, forming a central pillar of Canberra’s long-term strategy to enhance its deterrence and long-range strike capabilities in the Indo-Pacific, particularly in response to China’s growing military presence.
The overall program could cost up to 235 billion Australian dollars over three decades and includes provisions enabling Australia to eventually manufacture its own submarines domestically.
Defense Minister Richard Marles confirmed that the new facility at Osborne, near Adelaide in South Australia, will serve as the program’s industrial hub. Over time, approximately 30 billion Australian dollars is expected to be invested in developing the site.
Separately, in September, Canberra outlined an additional 8 billion Australian dollar plan over ten years to upgrade shipbuilding and sustainment infrastructure in Perth, Western Australia, preparing it to support a future fleet of nuclear-powered submarines.
Australia’s pivot to AUKUS followed its 2021 cancellation of a major diesel-submarine contract with France, a decision that triggered diplomatic tensions. The pact later faced uncertainty when Washington initiated a review to assess its compatibility with former President Donald Trump’s “America First” policy agenda. In December, however, the Pentagon confirmed the agreement would proceed.
