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Fed: Warships to be built with Aussie steel

11 May 2009 4:22 PM

CANBERRA, May 11 AAP - Three and maybe four advanced air warfare destroyers are to be built with Aussie steel.

Prime Minister Kevin Rudd announced on Monday that BlueScope Steel had won a $20 million contract to supply steel to build three of the 6,250 tonne destroyers for the Royal Australian Navy.

The government has left open the possibility of acquiring a fourth.

Speaking at BlueScope's Port Kembla plant - the largest steelworks in Australia - Mr Rudd said it was a great achievement for the company which would see it supply steel for the project for the next six years.

"It shows not only can Australian companies compete on defence projects with the best in the world, they can win and win on their merits."

Under the air warfare destroyers (AWD) program, launched in 2007, Australia will buy three advanced warships based on the Spanish-designed Navantia F100, at a cost of $8 billion.

They will be constructed by Adelaide-based ASC, formerly the Australian Submarine Corporation, at its yard at Osborne in Adelaide's northwest.

The three warships will be named Hobart, Brisbane and Sydney and will enter service in 2014, 2016 and 2017. All will be equipped with the Lockheed Martin Aegis combat system.

In another contract announced last week, the Air Warfare Destroyer Alliance selected the Newcastle-based FORGACS Group and Cairns-based NQEA Australia Pty Ltd to build 70 per cent of the AWD hull modules at a cost of about $450 million.

Mr Rudd said he was confident Australian companies would be heavily involved in the destroyer project.

"I'm confident there's going to be maximum delivery of Australian project content," he said.