Shipyard on uneven keel after all hull breaks loose in navy order
Cameron Stewart From: The Australian November 03, 2010 12:00AM
UP to $75 million of naval hull construction work could be stripped from Victoria.
The threat follows the bungling of the construction of the central keel block of the navy's first air warfare destroyer by workers at Melbourne's Williamstown shipyard.
But the prime contractor for the $8 billion AWD project, the AWD Alliance, would try to cushion any blow to the shipyard by giving it extra "fit-out" work on the new warships to maintain the overall volume of work and prevent possible job losses.
The shipyard's manager, BAE Systems, which last year won a $300m contract to build one-third of the hull blocks for the navy's three new AWDs, is in damage control after it constructed a keel block to the wrong dimensions, triggering an estimated six-month delay in the nation's largest defence project.
The AWD contract was lauded by the Victorian government at the time as a boost for the local economy that would secure work for up to 500 shipyard employees.
However, the prime contractor, the Adelaide-based AWD Alliance, is understood to be considering an option to strip some hull construction work from BAE in Williamstown and give it to the other two shipyards that are also building AWD hull blocks: the Australian Submarine Corporation in Adelaide and Forgacs in Newcastle.
Under the plan, which is yet to be formally approved, nine of the 36 AWD hull blocks that were due to be built by BAE in Williamstown would now be constructed in Adelaide and Newcastle, effectively stripping BAE of 25 per cent of its hull construction work.
AWD Alliance told The Australian yesterday that it was considering "reallocating" block work between the three shipyards while also "increasing the levels of advanced fit-out work done by the shipyards".
The alliance claimed that under this plan, "the volume of work allocated to each shipyard would not be reduced".
AWD Alliance -- a group comprising ASC, the Defence Materiel Organisation and Raytheon Australia -- is urgently looking at options to get the massive project back on schedule, with the first ship due to enter service from 2014. The alliance is also examining putting on shifts for workers at Williamstown to help make up for lost time.
It blamed BAE for the keel bungle, saying a lack of know-how was a contributing factor. Sources say faulty welding and inadequate quality control led to the miscalculation in the keel block dimensions. BAE says the faulty keel has now been fixed.
Under the original contract, ASC, Forgacs and BAE would each build about one-third of the 96 hull blocks for the three warships and then the warships would be constructed at ASC in Adelaide.
The three new 6500-tonne AWDs, based on the Spanish F100 boats, will be the most capable warships in the nation's history when they enter service from 2014.
Opposition defence spokesman David Johnston has said he believes the keel bungle has put the AWD project at least 12 months behind schedule.