ADI hits mark with ammo and explosives

Australia's ammunition and explosives manufacturing capability has received a welcome shot in the arm.
Australia's home-grown defence capability was boosted recently with the signing of a Deed of Cooperation between Defence and ADI Ltd to modernise the Mulwala propellant and explosives manufacturing plant in southern New South Wales. The Deed was signed at a ceremony in Canberra by the Commander Joint Logistics, Major General Peter Haddad, and the Managing Director of ADI Limited, Mr Lucio Di Bartolomeo.

Under the Deed ADI, which manages and operates the existing facility, will issue the redevelopment tender, evaluate the responses and submit a proposal to Defence. The company has announced its plans to offer private financing for the $200 million project. Defence will also have the option to directly finance the modernisation work.

TheMinister for Defence, Senator Robert Hill, said in a statement the government is expecting that three consortia headed by large Australian companies and supported by major international technology providers, will submit tenders.

The Mulwala plant was built in 1943 and its age and scale led to inefficient and costly production. The factory was almost shut down in 2001 and only an intense campaign from local workers and those mindful of its strategic importance prevented the facility from closure.

"Modernising the factory will ensure that the ADF has a locally-made supply of munitions and that Mulwala has an assured future," Senator Hill said.

ADI welcomed the signing with Mr Di Bartolomeo saying, "The signing of the Deed confirms the Government's intention to redevelop the facility and recognises the strategic importance of such a munitions capability. With the scope of the facility's modernisation now finalised by Defence, the project is on track to meet the Prime Minister's commitment to the Mulwala community to have a redevelopment contract in place by 2004.

"We are now looking forward to working with the Department of Defence to complete the tender and contract documents before issuing the request for tender as soon as possible," he said.

If contracts for the redevelopment are indeed signed by late 2004 it is expected that the new plant being brought on line progressively from 2006, and it seems that the move to guarantee local supplies of propellants and high explosives is timely.

The Mulwala factory supplies military-grade propellants and high explosives to ADI's Benalla ammunition manufacturing facility, which is located a gentle 40-minute drive in an explosives truck away in northern Victoria where a large range of Australian Defence Force munitions are manufactured.

This factory too has been upgraded recently with the opening of a production line to produce 25mm ammunition for the guns on the Army's fleet of ASLAV armoured vehicles, the Navy's Minehunters and the 15 new patrol boats due into service from 2005.

This state-of-the-art medium calibre assembly line is expected to assemble approximately two million rounds per year to begin with using imported components. Propellants from Mulwala will be used as soon as they can be proved in this round and plans to manufacture projectiles at ADI's Lithgow plant may yet come to fruition.

According to Neil James, Executive Director of the Australian Defence Association, "A ready and steady source of 25mm ammunition is essential to the effective training and operational employment of the Navy's new patrol boats and the Army's ASLAV armoured vehicles. The ability to produce such ammunition in Australia is a genuine step forward in national defence capability."

Investment in the new medium calibre capability would seem to be a canny move on the part of ADI who see significant growth potential in this sector, not only in 25mm as the new Freemantle class patrol boats enter service and the Huons are changed to that calibre, but also in 30mm when the Tiger Armed Reconnaissance Helicopters enter service from 2006.

Other growth opportunities are on the horizon with Defence believed to be about to double its production requirement for 5.56mm ammunition for the Army's Steyr and Minimi light support weapons, a move that would require the installation of a new production line for that calibre in addition to the one already operating at Benalla.

Increased live fire training in the lead-up to recent overseas deployments, and a high ongoing operational tempo is behind the increased demand on a facility that already produces tens of millions of rounds per year.

The decision to acquire new tanks also has implications for the ADF's ammunition requirements. All the tanks under consideration use a 120mm gun, a calibre not currently manufactured in Australia.

By Daniel Cotterill, Canberra