The ANZAC Ship Project

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The ANZAC Ship Project set the standard for Australia's future naval construction projects. It has been an outstanding success at all levels - operationally and industrially.
The modern cliché is that good news isn't news. In the same month that newspaper headlines spoke of significant delays in two of the ADF's critical aerospace programs, and with major delays on other key maritime projects still fresh in Australians' minds, Tenix Defence delivered a piece of good news which went largely unreported.

On 16 June the company delivered the last of the ten ANZAC frigates it has built for the Australian and New Zealand navies. NUSHIP Perth, which is scheduled to be commissioned this month, was delivered on schedule and within budget.

Allowing for a minor agreed adjustment to the original delivery schedule -not one forced by late delivery or poor workmanship, incidentally - and a budget which was amended slightly during the early days of the project to accommodate the cost of a more powerful gun, that record makes the ANZAC Ship program the most successful warship construction project in Australian history. Indeed, the ANZAC Ship program qualifies as probably the most successful major defence project in Australian history.

At the hand-over of NUSHIP Perth the Minister Assisting the Minister for Defence, Mr Bruce Billson, described her as a "flexible, capable and cost effective warship" whose construction had drawn on the skills and expertise of hundreds of local suppliers, sub contractors and Tenix employees.

"The construction of this fine ship serves as an excellent example of the world-class result that can be achieved when Defence and industry work together as partners," Mr Billson said. "The ships built by Tenix have been of outstanding quality and have been delivered on cost, on time and on budget, to a schedule revised to accommodate new capabilities."

Tenix Defence's CEO, Robert Salteri, described the economic benefits of the program at the handover ceremony. Overall, he said, the ANZAC Ship Project has involved more than 3,000 companies in Australia and New Zealand, it has generated almost 8,000 jobs and contributed $3 billion in additional gross domestic product and $4 billion in direct investment - a massive injection into the two nations' economies.

Not only were the 10 ships delivered on schedule, the program achieved Australia and New Zealand Industry Participation (ANZIP) levels of over 80 per cent of the purchase price of the frigates. This was based on a mix of 60.6 per cent Australian content, 11.7 per cent New Zealand content, 7 per cent Australian offsets and 1.5 per cent New Zealand offsets and amounted to $3.076 billion of the $3.807 billion prime contract value (at 1988 values). The Australian program cost was $3.93 billion in 1988 values, or roughly $7 billion today. The total program cost, including the two New Zealand ships, is $4.366 billion at 1988 prices, the basis on which all costs and payments have been calculated throughout the duration of the project.

The first of class, HMAS Anzac, was launched on 16 September 1994. When she was commissioned in June 1996 she cost $192.8 million dollars. HMAS Perth, by contrast, cost just $144.8 million.

The Defence Materiel Organisation's Director General Major Surface Combatants, CDRE Drew McKinnie, can probably afford to feel slightly smug about this - not only is Perth cheaper than her nine sisters, she is more capable, incorporating Harpoon missile and MU90 lightweight torpedo launchers along with other capability enhancements introduced during the build program.

The 1986 Dibb Report and 1987 Defence White Paper both identified the need for a second-tier surface combatant, or patrol frigate, to replace the RAN's Destroyer Escorts. This would put it below the existing DDG destroyers and FFG frigates in the RAN's hierarchy of capabilities, but it should also be capable of being upgraded to undertake first tier tasks, if necessary.

The RNZN had a similar requirement at the same time and in March 1987 signed an MoU with Australia to establish a joint project office.

The ITR process shortlisted two potential designs: Germany's Blohm + Voss Meko 200 frigate and the Dutch M-class frigate from Royal Schelde. They were courted by, and eventually partnered with, two consortia bidding for the prime contract: Australian Marine Engineering Consolidated (AMECON), led by Transfield, and Australian warship Systems Ltd, led by Carrington Slipways in Newcastle, NSW, respectively.

In August 1989 AMECON was selected to build eight Meko 200-based ships for the RAN; in December New Zealand ordered two ships with an option for two more, and signed a treaty with Australia to collaborate on their acquisition and construction. By 1994 it had become clear that the RNZN probably wouldn't exercise its options, resulting eventually in Project Protector and the construction instead of a mixed fleet of multi-role and patrol vessels by the company that AMECON evolved into, Tenix Defence.

As originally specified, the ANZACs were armed with the RIM-7P NATO Sea Sparrow Missile and the OTO Melara 76/62 rapid fire gun. The latter was replaced at the RAN's insistence in November 1989 with the United Defense (now BAE Systems) 127mm (5-inch) Mk45 naval gun, a choice which was justified in March 2003 during the now-famous "Five Inch Friday": HMAS Anzac provided heavy and accurate naval gunfire support for British Royal Marines on the Al-Faw Peninsula in southern Iraq and so became the first RAN warship to fire her guns in anger since Vietnam.

The ANZAC frigates were never intended to be 'off the peg' solutions: their basic design needed some modification to meet the RAN's needs for range and endurance and also to provide a sound basis for future growth. The necessary design work was carried out locally by Tenix and Blohm + Voss Australia (now Thyssen Krupp Marine Systems Australia).

The modular Meko 200 design concept made it possible to configure the ANZAC design with sufficient weight and space allowance for future upgrades - the so-called 'fitted for but not with' philosophy. This attracted considerable criticism then and later, but was probably essential at the time to ensure that the RAN could order sufficient surface combatants with sufficient growth potential at an affordable price. In hindsight, it may have been a smarter move than posterity gives credit for.

The re-design process also enabled Tenix to source equipment and components from Australia and New Zealand to meet its ANZIP obligations. And because the contract was performance-based rather than rigidly prescriptive, Tenix was able to change some of the major baseline equipment choices such as the navigation system, Electronic Surveillance (ES) system, propellers and fin stabilisers to help meet ANZIP and budget goals without affecting contracted capability.

One of the most important configuration items, of course, was the ship's Combat Management System. This was the Philips (then Bofors, then CelsiusTech, now Saab Systems) 9LV Mk3 which proved to be one of the highlights of the project in that it worked properly when it was delivered.

Notwithstanding widely reported criticism during the late-1990s of their relative lack of capability, the ANZAC frigates have done everything the governments of New Zealand and Australia have asked of them, in war and peace, from the Southern Ocean to the Gulf. As reported previously in ADM, the ANZACs' unique combination of shallow draft, manoeuvrability, sensors and weapons suit them especially well to security, patrol and response operations in littoral waters.

A retired senior naval officer told ADM the ANZAC ships were shaped by the fuzzy strategic thinking at the time they were conceived.

Then, and until as recently as the mid-1990s, there was a school of thought in Canberra which held that there would be sufficient warning of emerging strategic threats to upgrade the capabilities of platforms such as the ANZACs, hence the unfairly pejorative 'fitted for but not with' tag they carried. Hence also the war fighting and survivability upgrades they are now undergoing (see p.xx).

It must be remembered the ANZACs were conceived as part of a tiered naval concept developed to give capability level options for different military contingencies and to help people understand the roles and capabilities of the different warships the RAN used. Tier 1 was the DDG with the highest level of C2 and combat capability; the FFGs formed tier 2; the Destroyer Escorts which the ANZACs were designed notionally to replace were tier 3.

However, this hierarchy of forces hasn't survived, and the RAN's surface fleet is shrinking. The DDGs were not replaced when they retired; attempts to turn Australia's ANZAC frigates into mini-DDGs through the ANZAC Warfighting Improvement Program (WIP) proved fruitless; the FFGs will be replaced in effect by the new Air Warfare Destroyers; and the RAN's surface combatant force will likely consist by 2020 of the AWDs and the upgraded ANZAC force.

There isn't room now for ships lacking survivability and genuine war fighting capabilities. The "fitted for but not with" philosophy is discredited and we are starting to see a welcome though belated convergence of budget commitment and rigour in the capability development process.

That said, in praise of the ANZAC ships and the project overall, including the current program of upgrades being implemented by the ANZAC Alliance, one former Navy chief told ADM: "They are a good example of what can be done in Australia by Australian industry, which can only deliver what Defence asks of it."

TABLE: Anatomy of the ANZAC Ship
(Including enhancements and upgrades)
Length 118m
Beam 14.8m
Draft 4.4m
Displacement 3,600 tons
Max Range (@ 18kt) 6,000nm
Max Speed >27kt
Ship's Company 163

Propulsion: CODOG - 1 x 30,000shp GE LM2500 gas turbine; 2 x 8,500hp MTU 12V1163 Diesels; twin shafts; Bird Johnson controllable pitch propellers; 4 x 650kW diesel generators

Weapons: Combat management System Saab 9LV 453 Mk3
(Replaced by 9LV Mk3E)
Fire Control System Saab 9LV 453 J-band tracker
Saab 9LV 453 Optronic Director
Anti-Ship Missile Boeing AGM-84 Harpoon Block II
(As part of ANZAC block upgrade program)
Point Defence Missile VL/RIM-7P NATO Sea Sparrow
(Replaced by Evolved Sea Sparrow Missile, ESSM)
Mk41 Mod5 8-cell vertical launch system
Mk73 Mod1 CWI Transmitter
(Replaced by CEA-Mount CWI)
ASW System 2 x Mk32 Mod5 triple torpedo tubes
(Mk46 torpedo replaced by MU90 Impact)
Decoy SRBOC Mk36 Mod1 chaff launcher
(Supplemented by BAE Systems Australia Nulka)

Sensors: Search Radar Raytheon AN/SPS-49(V)8 long range air search
Target Indication Radar Saab 9LV 453 TIR Air/Surface radar
Navigation Radar Krupp Atlas 9600M
ESM Thales Sceptre A
(Upgraded to Thales centaur configuration)
Sonar (hull mounted) Thales Underwater Systems Spherion B
(Supplemented by TUS Petrel MOAS)
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