Two Illawarra manufacturers will play a major role in the production of Australia's future submarine fleet.
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BlueScope and Bisalloy have been selected to supply the hull steel for Australia's future fleet of nuclear submarines.
Defence industry minister Pat Conroy made the announcement on Saturday on the eve of his visit to the United States to secure the alliance as members of the US Congress wrangle over whether the US will deliver Virginia-class submarines to Australia under the pact.
BlueScope will produce about 1000 tonnes of steel under the contract with the Australian Submarine Agency, while Bisalloy will perform the heat treatment process to meet US and UK standards for high-pressure, submarine hull grade steel.
"The qualification of Australian steel is an important step in the Australian Government's strategy for acquiring state-of-the-art conventionally armed nuclear-powered submarines," Mr Conroy said.
Bisalloy Steel managing director and CEO Rowan Melrose said the contract was a win for the Illawarra.
"This is a significant announcement for Bisalloy as it highlights the quality of our products, our ability to deliver to the highest standards, and the recognition and trust of a long-standing supply relationship with Australia's Defence industry."
Business Illawarra executive director Adam Zarth said the announcement was a major win for the region, as it attempts to secure a large slice of the Defence pie.
"What this does is shine a bright light on what we've been saying for a while, which is that the Illawarra has an integral role to play in the defence industry," he said.
After the launch of a Defence Industry Strategy for the region earlier this year, Mr Zarth said the hunt was on for a "champion" for the region's defence industry.
"Somebody who has been deeply involved in defence themselves, potentially as a uniformed member of the Defence Force at a senior level."
Under the contract for the AUKUS submarines, the steel will be put through 4500 tests to be completed in the first half of 2025. The steel will be used for qualification purposes, as well as to develop the necessary welding procedures, including in early production demonstration activities before the construction of the first Australian-made AUKUS submarine later in the decade.
"The strength and quality of Australian steel will keep Australian submariners safe in the SSN-AUKUS nuclear-powered submarines for decades to come," Mr Conroy said.
BlueScope general manager manufacturing David Scott said the announcement built on the region's history of supplying defence projects in the past.
"BlueScope has a long history of supplying plate for Submarines dating back to the Collins Class subs in the 1980s," he said.
Mr Zarth said behind BlueScope and Bisalloy was an array of smaller, supporting enterprises.
"There are so many jobs tied up in this, and this is where we can't drop the ball when it comes to upskilling future generations of locals here in the Illawarra and focus on the fact that defence is a key, advanced manufacturing sector that this region has strengths in."
