The Australian government has committed A$3.9bn ($2.7bn) as an initial investment in a new submarine construction yard in Osborne, South Australia.
The facility will support the delivery of conventionally armed, nuclear-powered submarines and is expected to create nearly 10,000 jobs in the state.
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The project at Osborne will involve three main areas dedicated to fabrication, outfitting, and consolidation, as well as testing, launching and commissioning activities.
The Australian Naval Infrastructure (ANI) projects a total investment of A$30bn over several decades for the site’s full build-out.
Enabling works are estimated at A$2bn, while the Skills and Training Academy (STA) is expected to require over A$500m.
The STA Campus began construction in 2025, and its first students are due to commence studies in 2028, with an aim to support up to 1,000 learners annually.
Prime Minister Anthony Albanese said: “Together with the Malinauskas Government in SA, we are accelerating AUKUS opportunities to secure Australia’s future defence capability and create lasting prosperity and jobs for the state.
“Investing in the Submarine Construction Yard at Osborne is critical to delivering Australia’s conventionally-armed, nuclear-powered submarines. Labor [party] will always back continuous naval shipbuilding and advanced manufacturing, which is vital to South Australia’s economy and long-term growth in local industry.”
At full scale, the submarine construction yard will be 10 times larger than the existing Osborne South Development project and is expected to use 66-million-man hours and 126,000 tonnes (t) of structural steel.
The Fabrication Hall will measure 420 metres (m), more than double the length of Adelaide Oval.
ANI is also overseeing delivery of the precinct, including recent completion of Eurimbla Way, a new road linking Pelican Point Road with the shipyard completed by around 170 workers on schedule and within budget.
The road was opened to traffic on 9 February 2026.
More than 500 local workers are involved in building both the STA Campus and Production Demonstration Facilities at Osborne.
Overall employment linked to this investment is projected at over 9,000 people, with approximately 4,000 workers to design and construct the submarine yard and another 5,500 to support peak submarine production.
The investment in the submarine construction yard complements existing defence facilities at Osborne supporting Collins-class maintenance and Hunter-class shipbuilding.
Development ties into broader efforts such as the South Australian Defence Industry Workforce and Skills Action Plan, which has allocated A$300m for workforce initiatives involving defence industry development and technical college establishment in the state.
Final costs of the construction programme will depend on ongoing design details and contractual arrangements managed by ANI on behalf of the government.
Future investment decisions are expected as infrastructure demands become clearer through design maturity and regulatory approvals for consolidation, launch, and commissioning operations across the site.
In November last year, the Australian government announced a contract under which South Australian company PMB Defence will collaborate with BAE Systems in the UK.
