Tenix delivers the final Anzac frigate

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On schedule, on budget and superior to the first of class - the last of the Anzacs is a fine achievement by Tenix, the DMO and 1,300 companies in Australia and New Zealand.
By the time the D+I Conference 2006 opens in Canberra on 20 June, Tenix Defence will have handed over the frigate Perth to the RAN at Williamstown dockyard in Melbourne. She is the last of the ten Anzac-class frigates the company has built (two of them for the RNZN) and her delivery to the Navy marks the end of the largest naval construction program in Australia's history so far and, by any measure, the most successful.

The NUSHIP Perth is on time and on budget and has greater capability than her sister ship, HMAS Anzac, which was commissioned ten years ago last month.

"That's a pretty good achievement," says Commodore Drew McKinnie, the DMO's DG Major Surface Combatants and Anzac frigate project director.

The ten ships have been delivered under a fixed-price contract and a project budget of $3.93 billion in 1988 dollars, or about $7 billion in 2006 dollars. There has been no cost blow-out, says McKinnie - the only fluctuations have been the result of inflation, exchange rate movements and agreed changes to the configuration of the ships as modifications such as the Harpoon upgrade and integration of the MU90 lightweight torpedo were incorporated prior to launch.

For the record, HMAS Anzac cost $192.8 million in 1988 dollars; HMAS Perth cost $144.8 million by the same reckoning.

Because it has been a successful and generally trouble-free project, the Anzac frigate program has rarely made the headlines, so many Australians were unaware of the value they've received for their tax dollars until the now-famous "Five-inch Friday".

On that day in March 2003 HMAS Anzac used her 5-inch Mk45 gun to deliver heavy, accurate and devastatingly effective naval gunfire support to a force of Royal Marines clearing the Al Faw peninsula in southern Iraq. It was the first time an RAN warship had fired her guns in anger since the Vietnam War.

The ship's shallow draft, along with her speed, manoeuvrability and a credible sensor suite, enabled HMAS Anzac ship to undertake the critical maritime traffic management task at the northern (high-threat) end of the Gulf during the 2003 war. And it makes the Anzac frigates the platform of choice today for the critical task of patrolling and protecting Iraq's offshore oil platforms which lie in relatively shallow water and are a regular target of insurgents in fast attack boats.

Importantly, also, the program built up Defence's confidence in the local industry and its ability to build, deliver and support a modern warship as well as its ability to adapt successfully an overseas design. Many of the DMO, Naval Systems Command and industry project managers and engineers who cut their teeth on the Anzac frigate program in the 1980s and '90s are now applying that experience across a range of projects but, most visibly, the AWD program.

The Anzac frigate program has been incredibly important for Australia's naval industry as a whole, according to Paul Thomas, Tenix Defence's general manager for shipbuilding. It was the platform upon which Tenix grew to become, in 2004, Australia's biggest defence and project management company, topping the ADM Top 40 listing and turning over close to $1 billion in defence and civil work.

To win and then deliver the Anzac contract Tenix had to turn round the troubled Williamstown dockyard in Melbourne, which was a by-word for inefficiency and industrial unrest. It brought the construction of two FFG frigates back on track and then assembled a team of 1,300 suppliers and sub-contractors in Australia and New Zealand. Many of these companies had little experience of naval or defence work and few of them had been exposed to the performance, quality assurance and project management expectations of a demanding military customer.

The Anzac project injected money, technology and much-needed management and quality control expertise into companies in Australia and New Zealand which contributed everything from pre-fabricated hull modules and combat system software to air conditioning systems, pumps and compressors and nuts and bolts.

"There'll never be another Anzac project," believes Paul Thomas. "It's been probably the most successful defence project the country is ever likely to see."

The RAN and DMO have thoughtfully studied the lessons from the Anzac project and are applying them to the forthcoming Air Warfare Destroyer and amphibious landing ship (LHD) programs.

Lesson one: it's important to invest the effort up-front in working out the user requirement and concept of operations in detail according to CDRE McKinnie.

Lesson two: you need to assemble the right combination of ship designer, ship builder and combat system provider. In this case, Blohm + Voss, Australian Maritime Technology, Tenix and Saab Systems all worked well together.

Lesson three: you need to engage the potential suppliers and sub-contractors early on so that the production process runs smoothly.

These lessons have shaped Defence and industry's approach to the AWD program also, says McKinnie.

For Tenix, the end of the Anzac delivery program has created some uncertainty over the future of the Williamstown yard.

Paul Thomas told ADM the yard is busy at present building two Offshore Patrol Vessels (OPV) for the RNZN and modules for the four IPVs which will be assembled at Tenix's Whangarei yard in New Zealand. The first OPV is due for delivery in mid-2007 and the second by the end of that year.

The company is also bidding for other international ship construction projects as well as the Navy's LHD program, in partnership with Spanish yard Navantia, and will be bidding aggressively for AWD module constriction work once this program gets under way next year.

The company has a good in-house design and engineering team and a strong sub-contractor base, so it's in good shape to bid for and deliver a range of maritime projects, Thomas told ADM.

For CDRE McKinnie, industry has performed well on the Anzac project - this is borne out by its schedule and financial performance and the fact the Maritime Commander (McKinnie's customer) has been happy with the capability delivered.

One reason why so little was heard of the Anzac frigates was the fact that their combat system, or Combat Management System, to give it the correct title, worked properly right from the start. The 9LV Mk 3 combat system was design by Saab Systems Pty Ltd in Adelaide and based on the Swedish parent company's System Family 2000; it had to be modified extensively to accommodate new weapons and sensors, but still worked properly, straight out of the box.

For Saab Systems which, like Tenix, built its business on the back of the Anzac program, the project has been the foundation for a diversified business turning over some $177 a year and now employing 300 people in Adelaide, says business development manager Mark Proctor. The baseline Anzac frigate combat system has been worth around $500 million to the company, and spawned a $130 million In-Service Support contract to support the ships in service.

Now Saab Systems is part of the Anzac Alliance with Tenix and the Commonwealth, delivering a rolling program of enhancements and upgrades - one of which, the Harpoon Upgrade, won one of ADM's inaugural Essington Lewis Awards earlier this year.

The Anzac program underpinned Saab's diversification into the land and air domains, sustained by the capabilities the company has built up in R&D, modelling and analysis. It is prime on the Army's battlefield Command Support System and is developing the Tactical Command and Control System (TaCCS) for 16 Air Defence Regiment's RBS-70 missile systems. This one product alone has significant export potential. And Saab is hoping its experience brings it round full circle to provide a command and control system for the Navy's new LHDs based on a derivative of the latest 9LV Mk3E CMS it is delivering for the Anzacs.

However, one criticism levelled at the Anzac frigates - notably by former defence industry, science and personnel minister Bronwyn Bishop, was that they were under-armed and under-protected due to the "fitted for but not with" philosophy behind their design.

The Anzacs were designed at a different time and in very different strategic and political circumstances, points out McKinnie. And the fact they were based on the German MEKO 200 design made them easier than many other ships to modify and upgrade as they are designed around modules which can be changed or re-configured relatively simply.

The Anzac project office foresaw the need to incorporate new technology and improved sensors and weapons in the future - in fact, probably before the last of the ships was actually completed, as proved to be the case. So they were actually built in small batches of two or three with later batches fully expected to differ from the first of class.

HMAS Anzac is now ten years old and has been through the first of a rolling series of upgrades: she now carries Harpoon missiles, the new MU90 lightweight torpedo, Thales Underwater Systems mine and obstacle avoidance sonar, and she and her sister ships will soon undergo the Anti-Ship Missile defence (ASDMD) upgrade, implemented by the Anzac Alliance. But some of these upgrades were built into Perth before she was even completed - and still she was delivered at the agreed price.

By Gregor Ferguson, Adelaide
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