Two South Australian companies will make steel cruise ship blocks for Italian shipbuilding giant Fincantieri in the running for a contract to build nine Australian Navy frigates.
Adelaide-based MG Engineering will construct two blocks and Whyalla-based Ottoway Engineering will construct the third block, AAP reported.
They were selected for the work by Fincantieri, one of three international companies tendering for the SEA 5000 Future Frigate program.
Sean Costello, Fincantieri’s Australian director, said the block-building work was a “test order” and will sound out the local industry.
“We get to find out who are the good suppliers out there that can help us and we get to find out what it truly costs to do the work in Australia,” he said.
Each of the three blocks will be just under the size of a tennis court, and together they will use 52 tonnes of Australian steel.
The blocks will be completed by June 30, coinciding with the time federal cabinet’s national security committee is expected to make a decision on the $35 billion frigate contract.
Should Fincantieri win and the cruise ship blocks are satisfactory, the local companies will be primed and ready for work on the defence project.
Should they lose, Costello said local operations will be “much less important” but the company would not pull out of Australia.
“Everything that is set up and committed to continues to roll on,” he said.
Earlier in March, Fincantieri had signed a Memorandum of Understanding with key Australian trade unions, committing to help Australia build a sovereign shipbuilding capability.