Pacific 2008: Mobilising the naval industry | ADM Dec 07/Jan 08

By Julian Kerr

With prime contracts now signed for the Navy's Air Warfare Destroyers and amphibious landing ships, the window of opportunity is starting to open for suppliers and sub-contractors seeking work on these projects.

With the design selected and construction contracts signed for Australia's three new Air Warfare Destroyers (AWD), potential suppliers and sub-contractors hoping to benefit from the $8 billion program are now sharpening their pencils.

Late last year ASC Pty Ltd., the mandated shipbuilder for the Hobart-class AWD program, conducted a series of briefings aimed at potential module subcontractors.

Of the 27 modules in the current build plan for an AWD, ASC is planning to outsource 19, or about 70 per cent of total construction.

This element of the project will be worth more than $450 million.

"We invited companies to have a look at other programs of this type around the world and they've done that," commented John Gallacher, Chief Executive Officer of the AWD Alliance.

"We've had a great response, and we hope that a Request For Tender (RFT) for modules can be issued sometime between next February and May."

Evaluation teams visited 19 potential module manufacturers in Perth, Whyalla, Melbourne, Portland, Tasmania, Illawarra, Sydney, Newcastle, Brisbane, Cairns, Darwin and New Zealand, and ASC is satisfied that the program's needs can be met by the existing infrastructure.

The pre-outfitted hull modules or blocks are manufactured in a workshop environment to maximise production efficiencies.

They are then joined to form a completed ship, with final outfitting occurring on the building berth.

Companies will be contracted to supply the same blocks for all three ships, with all ship equipment and materials supplied on a free-in-aid basis.

The shipbuilder will outsource the transportation of completed blocks to ASC's new AWD facility at Osborne, northwest of Adelaide on the Port River.

ASC itself is spending more than $100 million on buildings, cranes, plant and equipment at the facility, which is next door to Techport Australia, the country's largest naval shipbuilding hub.

Infrastructure support
The South Australian Government is spending a further $300 million in its State-owned infrastructure within Techport Australia, including a world-class Common User Facility (CUF).

The CUF will include a 213 metre-long wharf, ship transfer system and Australia's largest ship lift.

This will be 156 metres long and be capable of lifting ships that weigh up to 9,300 tonnes - 3,050 tonnes more than a fully laden AWD.

As the AWD shipbuilder, ASC is responsible for shipyard infrastructure, project management, production planning, management of platform systems and material procurement, the management of block construction outsourcing, construction and ship physical integration, combat and platform systems installation, and ship test and activation.

Following the signature on 4 October of the Alliance-based Target Incentive Agreement (ABTIA) between the Commonwealth represented by the Defence Materiel Organisation, ASC Shipbuilder Pty Ltd (ASC) as the shipbuilder, and Raytheon Australia Pty Ltd as the AWD combat systems - systems engineer.

The Alliance conducted a series of roadshows to update industry on the progress of the project and to highlight business opportunities.

The roadshow, headed by senior Alliance executives including AWD Program Manager Warren King, received some 1,300 registrations of company interest during visits to Canberra, Cairns, Newcastle, Wollongong, Sydney, Launceston, Brisbane, Melbourne, Adelaide and Perth.

The broad AWD procurement principles articulated by the Alliance comprise value for money, efficient and effective process, ethics and probity, accountability and transparency, good faith and fair dealing and competition.

These generally echo the ethos of the Alliance itself, involving as it does collaborative decision-making, transparency, an emphasis on best-for-project outcomes, and pain and gain in terms of schedule and cost being apportioned between the three partners.

Major equipment is already defined and specified by Navantia S.A., the Spanish designer of the F100 guided missile frigate on which the Hobart class is based.

This approach maintains the benefits of a low risk Military-Off-The-Shelf (MOTS) solution, and the Alliance will utilise Navantia's established supply chain.

Local content opportunities
However, Australian industry will be informed by the Alliance of Navantia sources of supply, supporting development of opportunities around agencies and through-life support.

Other opportunities envisaged for Australian industry include commodity material and minor equipment worth more than $200 million and through-life support.

The Alliance envisages local agreements covering activity in installation, set-to-work/commissioning, warehousing spares, technical support and warranty support.

In addition to delivering the Hobart class design, Navantia will perform all the necessary and requested design modifications and maintain design configuration control.

It will also transfer the current building process to ASC, provide technical assistance to ASC and Raytheon and training as required, and supply a management system to manage and control the construction process.

The AWD preliminary design review will take place in December 2008, with the vital Critical Design Review scheduled for December 2009, although the last block design data pack will not be completed until April 2011.

Fabrication of the first AWD, HMAS Hobart, is scheduled to begin in September 2009 with provisional acceptance in December 2014.

Fabrication of HMAS Brisbane will get underway in December 2010 with provisional acceptance in March 2016, and fabrication of HMAS Sydney will begin in March 2013, with provisional acceptance anticipated in June 2017.

The schedule allows 16 months for integration of the hull blocks at Osborne.

As the AWD Mission Systems Integrator, Raytheon Australia will complete the Australianisation of the combat system around the Aegis core, which will be supplied by the Commonwealth via the US Foreign Military Sales program at a cost (additional to the build program) of about $1.5 billion.

Specifically, Raytheon will integrate the non-Aegis elements of the combat system and conduct combat system trade studies, develop the design of the complete AWD combat system, develop complete ship and Integrated Support Systems with Navantia and ASC, develop project management and systems engineering structures, and deliver mission systems integration.

Upgrades and changes
While any changes to the design of the AWD platform will generally be driven by legislative and obsolescence issues, Australian industry input to the combat system may include secondary and tertiary military system integration, mobile military communications, electronic warfare systems, niche radar capabilities, and underwater acoustic technologies.

The overall guide to acquisition will be whether the capability already exists, or whether it can be developed within acceptable bounds of cost and risk.

Raytheon Managing Director Ron Fisher told ADM that the proposed Australia -US Treaty on Trade Cooperation would make little difference to the information flow from the US.

"We couldn't wait for this to happen. We've already implemented a process to take account of ITAR (International Traffic in Arms Regulations) issues and it's working well," he commented.

According to schedules made public at the Alliance roadshows, a range of Requests for Tender (RFT) for weapons systems will be released before the end of 2007 and contracts signed within the second quarter of 2008.

The RFTs are largely for systems that have already been selected. These include the 5inch Mark 45 Mod 4 deck gun, Evolved Sea Sparrow Missile (ESSM) system, Phalanx close-in weapons system, the Mu90 Eurotorp lightweight torpedo and the Nulka active missile decoy.

The RFT for the electronic warfare system will not be released until the first quarter 2010, with delivery of Ship Set One in the final quarter of 2012.

Although the RFT for the communications system will not be issued until the third quarter of 2009, delivery of the first Ship Set will be in the first quarter of 2011.

Underpinning combat system planning is the intention to build a robust architecture that is stable over the life of the system, supporting multiple design variants to enable managed evolution in capability and technology.

Key principles include the use of proven off-the-shelf equipment, maintaining the verification boundary between sensor, weapons, and command and control, leveraging off existing ADF infrastructure, and minimising impact to the platform.

Other guidelines involve minimum changes to the baseline Aegis system, architectural robustness, manageable risk, alignment with ADF roadmaps, and the ability to support future emerging capabilities.

Weapons
One such example is the SM-2 Block IIIA missile, which is being introduced to the RAN's FFG frigates and will also equip the AWD.

Should a decision be made to upgrade the AWDs' missile fit to the SM-3 to provide theatre-wide defence against medium and long-range ballistic missiles, the software and hardware changes this would entail have already been taken into account in the growth path for the AEGIS combat system.

As described by Commodore Andrew Cawley, Director-General AWD Program in the DMO, "it's not about changing the platform, changing the antennas, it's just about loading up into the core AEGIS program the software code that enables it to perform that function."

Notwithstanding the reference in roadshow presentations to domestic niche radar capabilities, Canberra-based CEA's CEAFAR active phased array radar will not be included in the AWD baseline fit.

"Active phased array radar will be on the ships at some point but it won't be in the baseline; the technology is not ready for our schedule," Cawley commented.

No decision has yet been made on the release of RFTs for support functions.

As Cawley explained: "We've said through this front-end process of the acquisition project that it doesn't include the sustainment scope of work. We need to do that, obviously, and when we have a clear picture of the sustainment task we'll look at the various strategies that might be available".

The fact that four F100s were already in service with the Spanish Armada (Navy) would be of enormous benefit.

"The equipment won't be identical but their experience in operating ships, the period they can spend at sea, their understanding of Aegis, their intimate understanding of their own platform, is going to be of great assistance to us.

"The Armada are a navy very similar in size to our own and they're very clever in the pursuit of effective and efficient solutions."

LHD plans
Although the hulls of the two 27,000 tonne Canberra class Landing Helicopter Dock (LHD) amphibious ships will be built in Navantia's Ferrol shipyard in northwestern Spain, the superstructure for both ships will be constructed by Tenix and subcontractors, largely at Tenix's Williamstown shipyard.

The first hull will arrive in Australia in July 2011 and the second in February 2013, allowing about 18 months to complete assembly and fitout before delivery.

Although the Australian LHDs will be based on the strategic projection ship designed and being built for the Spanish navy by Navantia, in this project Navantia is acting as a subcontractor rather than a principal.

Tenix says it is now in the project's mobilisation phases with major sub-contractors, which involves location and relocation of workers, allocation of resources and general assembly of project inputs.

Copyright - Australian Defence Magazine, December 2007/January 2008