Defence is considering the strategic option of basing the future submarines on the east coast.

Port Kembla and Newcastle are understood to be the leading options.

Defence is working on a report looking into the various options to be presented to the federal government.

"Defence is conducting studies and a range of operational and support modelling to identify the most effective and efficient options for positioning of the Attack class submarine force," said Defence Minister Senator Linda Reynolds.

"Defence studies and modelling include a two-ocean basing concept."

At present, the only submarine base is at Fleet Base West, off the coast of Perth.

Under the "two-ocean basing concept", the Collins class subs would stay on the west coast while the 12 new submarines - the Shortfin Barracudas being built by French armaments company DCNS - would located on the east coast.

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Sen Reynolds said the location of the coming submarines "is still an ongoing discussion".

"Defence will make its initial report to government on the Submarine Capability Transition Plan in due course, noting the first future submarine is not due to be delivered until the early 2030s," she said.

In 2015 there was a push for a portion of the Garden Island base to be relocated to Port Kembla.

A group, including Liberal Senator Concetta Fierravanti-Wells and Labor MPs Sharon Bird and Stephen Jones, backed the report The Jewel of the East Coast, which was written by RDA Illawarra.

Also part of the group was BlueScope, which offered several locations around the harbour it owned that the navy could lease or purchase.

The Port Kembla steelmaker and Unanderra company Bisalloy are in the mix to supply the steel to build the submarines, with pressure testing taking place.