It is estimated that South Australia will gain more than 8,000 jobs to build nuclear-powered submarines and key construction facilities over 30 years as part of the AUKUS deal, according to the federal government.
But the first locally-made submarine is not due to be delivered until nearly two decades from now, in the early 2040s, and will require a huge expansion of the Osborne shipbuilding site and local skills base.
Key details of the AUKUS deal — which will cost up to $368 billion over the next three decades — were revealed by Prime Minister Anthony Albanese, US President Joe Biden and British Prime Minister Rishi Sunak in San Diego this morning, Australian time.
The government has said that, under the agreement, SA will become the "home of Australian nuclear-powered submarine construction", and that the state will require a "major capability and capacity uplift" and a $2 billion federal injection over the next four years.
Before local construction begins, Australia will take three, potentially second-hand Virginia-class submarines early next decade, as it develops a new submarine, known as the SSN-AUKUS, with the United Kingdom.
The UK's Royal Navy is expected to receive its first SSN-AUKUS in the late 2030s, before the Royal Australian Navy receives its first Australian-made nuclear-powered sub in the early 2040s, with five SSN-AUKUS vessels to be delivered to the RAN by the mid-2050s.
To achieve those targets, an estimated 4,000 workers will be employed to design and build a new construction yard in South Australia, and a further 4,000 to 5,500 "to build the nuclear-powered submarines in South Australia when the program reaches its peak in 20 to 30 years", the federal government said.
"There is so much work that is associated now with South Australia, there is so much work that we are asking as a national government this state to do," Foreign Affairs Minister Penny Wong said.
"Our challenge is people and skills, and that's what we've got to focus on.
"We will look at around the early 2030s of being able to have that design and construction in Adelaide, if we can do it earlier we will."
SA Premier Peter Malinauskas — who said the number of workers employed on submarine construction would be almost three times the number at the Holden plant when it closed in 2018 — used today's announcement to declare an end to the so-called shipbuilding "valley of death".
"There's been a lot of talk over recent decades about not just the capability gap in the submarine program itself, but the capability gap when it comes to workforce or what has otherwise been characterised as a 'valley of death'," he said.
"Those days are over — this is no longer a question of 'is there going to be enough work for our naval shipbuilding program in South Australia?' It's a question of, where are we getting the workers from."
Mr Malinauskas, who will travel to the UK tomorrow, said the deal would ensure nuclear submarine construction capability on an ongoing and indefinite basis.
"[This] is about making sure that we have the workforce with the skills that are required to be able to build nuclear submarines forevermore," he said.
Earlier this morning, Mr Malinauskas told ABC Radio Adelaide's Stacey Lee and David Bevan that he expected submarine construction work to begin at Osborne "in the second half of this decade" and that preparatory work "very much has to start now, particularly when it comes to building up the workforce".
Nuclear waste disposal unresolved
Under the AUKUS deal, Australia will become the seventh nation in the world with nuclear-powered submarines, and the SSN-AUKUS vessels will be powered by reactors containing enriched uranium.
"The nuclear reactor will come from overseas and be installed in the submarine here in South Australia," Mr Malinauskas said.
The question of what becomes of the high-level waste remains unanswered, but Senator Wong indicated it could end up on Defence land.
"We are required to deal with spent fuel from the reactors, that is obviously many decades from now given how long these reactors last.
"We will go through a proper process which starts with Defence looking at Defence Estate for the options on that."
Senator Wong said the AUKUS deal created obligations under the international Treaty on the Non-Proliferation of Nuclear Weapons and the Treaty of Rarotonga.
"Australia has an impeccable record when it comes to non-proliferation," she said.
"We will engage in this keeping to the highest standards of safety."
Senator Wong said that the AUKUS deal did not signal an intention by the government to explore nuclear power as an energy source.
Coalition commits to current plan
Despite assurances from the state and federal governments, former senator and submariner Rex Patrick expressed concern that South Australia had no absolute guarantee jobs would remain within the state.
"We've seen our submarine solution go from an Australian-designed son of Collins to a Japanese submarine to a French submarine, talk of a US submarine," he told ABC Radio Adelaide.
"A new government … will not be bound by any particular promises that have been made, again we've seen lots of changes on the submarine front as we've seen changes of government."
But Opposition senator Simon Birmingham committed to sticking to the plan under a future Liberal government.
"We continue to give bipartisan support to what overall is a necessary investment in Australia's defence capability and our defence industrial capability," he said.
"[But] we also need certainty and clarity … around the life of type extension of the Collins-class. Will that apply to all six Collins-class boats and if not, then what are the implications of that?"
Senator Wong said that work to maintain the Collins-class fleet would continue at Osborne, and that construction on the new yard for the AUKUS subs would begin later this year.
"The infrastructure construction on the yard will begin this year, due to begin later this year — this will involve both above and in-ground utility relocation, construction of a new access road and other supporting infrastructure," she said.
"The life of type extensions on the Collins-class will be retained."
Mr Malinauskas said that such an assurance would guarantee ongoing employment for hundreds of shipbuilding workers in the meantime.
"The Collins-class program is still absolutely central to maintaining the capability that the federal government needs," he said.
"It'll take time before those Virginia-class submarines start coming under the control of the Royal Australian Navy but indeed the life of type extension work is necessary to get those Collins-class [subs] operational and maintained in the water throughout the course of the decade ahead.
"That's good news, that's in excess of 1,000 jobs here in its own right here in South Australia."
