The federal government will build a missile factory on Newcastle Airport-owned land in partnership with Norwegian firm Kongsberg as part of a new domestic weapons manufacturing strategy.
Minister for Defence Industry and Capability Delivery Pat Conroy is expected to announce on Thursday that the more than $200-million factory will employ about 100 people when operating and 500 workers during construction.
Kongsberg will build and sustain its Naval Strike Missile, test-fired recently by the Navy off the coast of Hawaii, and air-launched Joint Strike Missile at the Williamtown plant.
It will be one of only two factories in the world building the missiles. The other is in Kongsberg in Norway.
The factory will be built on land owned by Newcastle Airport, which is owned by Newcastle and Port Stephens councils.
The federal government will invest a total of $850 million in the missile project, which includes its construction and operation, along with establishing supply chain links with Australian businesses.
Mr Conroy's office described the federal investment as a "leap forward" for Australia's defence industry.
"This is about investing in our advanced, high-tech manufacturing industry and developing our sovereign defence industrial base in areas which have been identified as strategic priorities, which in turn means we can accelerate capability delivery to the Australian Defence Force," Mr Conroy told the Newcastle Herald.
Mr Conroy will outline the government investment at the Hunter Defence Conference on Thursday night.
He is expected to tell conference delegates that the factory will bring $100 million in economic benefits to the Hunter.
An excerpt from his speech says the region is "host to a growing register of dynamic small to medium enterprises ... with a proven track record in the delivery of mission-critical components and services to the Australian Defence Force".
"With a world-class university, a skilled and adaptable workforce and an amazing lifestyle, the Hunter Valley's future is brighter than ever before, especially for those in the defence industry," the speech says.
Kongsberg Defence Australia managing director John Fry said the Newcastle factory "brings a new strategic capability to Australia, creating hundreds of jobs, and offering a unique opportunity for the Hunter region to become the hub for manufacturing these important high-technology Defence capabilities".
A group of protesters gathered outside the defence conference venue in the Hunter vineyards on Wednesday to oppose arms manufacturing on council-owned land and the use of Australian-supported war planes and weapons in Israel's war on Gaza.
"We know that every F-35 war plane, the ones that are used to massacre Palestinians, is reliant on parts made in Australia, several of which come from the Hunter region," protester Elena said.
The council-owned airport is developing a defence and aerospace business park at Williamtown called Astra Aerolab.
Kongsberg signed a contract with the government in January 2023 to supply the Naval Strike Missile to Australia's Anzac-class frigates and Hobart-class destroyers from 2024.
The four-metre, 416-kilogram missile has a range of more than 275 kilometres, can be fired from sea or land and costs upwards of $2 million.
Cardiff firm Nupress won a contract in February to supply components to Kongsberg for the NSM.
The Joint Strike Missile version of the weapon appears destined for the RAAF's fleet of F-35 fighter jets after the government's 2024 National Defence Strategy called for their acquisition.
