Australian government, French shipbuilder reach settlement over cancelled submarine deal

The Australian government has finalised negotiations with French shipbuilder the Naval Group to conclude the Attack-class submarine program, Prime Minister Anthony Albanese confirmed in a recent statement.

The country’s former government made the decision to terminate the contract on the basis of advice about capability requirements for the Australian Defence Force, said Mr Albanese.

The Prime Minister added that a “fair and equitable settlement” of €555 million (US$583 million) was reached with the Naval Group.

The Australian government entered into a contract with the Naval Group in 2016 for the construction of 12 new Attack-class diesel-electric submarines to replace the Royal Australian Navy’s Collins-class boats. However, the contract was cancelled in September 2021 during the term of Prime Minister Scott Morrison.

The cancellation of the Attack-class contract came in the wake of the formation of the AUKUS trilateral security partnership between Australia, the UK, and the United States. One of the projects of the partnership is Australia’s procurement of nuclear-powered submarines with assistance provided by the UK and the US.