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Last hand played out in sub saga

WINNING the $2.5 billion refit contract for Australia’s Collins Class submarines would be a boon for more than just the major defence contractors such as Tenix, Rayth-eon, Transfield and United Construction.

Smaller operators, including Veem Engineering, Austindo, Reads Electrical Co, EJ Electrical Engineering Contractors, Westrek and Wiltrading, already provide maintenance services to the WA-based submarines.

WA has the $40 million-a-year contract to maintain the submarines and will get an extra $80 million a year by picking up the refit work.

Tenix’s Henderson-based boat-lift facility has the capacity to take the submarines out of the water.

Veem makes the hull and ballast tank valves, silencers, emergency propulsion systems and garbage ejectors for the subs.

Austindo, Reads and EJ Electrical are the three electrical contractors licensed to work on the boats.

The electrical work is understood to be worth about 10 per cent of the total refit contract, meaning the three companies would be vying for a share of $8 million a year.

Both the WA Government and various industry groups have applied pressure to the Federal Government to secure the refit contract.

Premier Geoff Gallop took the opportunity of Prime Minister John Howard’s visit to WA this week to push the State’s case, and Chamber of Commerce and Industry chief executive Lyndon Rowe took his organisation’s arguments to Defence chiefs in Canberra.

The WA Government has already spent thousands of dollars this year promoting WA as the best place for the submarines to be refitted.

There remains a slight chance WA could win the refit contract, with Mr Howard agreeing to consider the State’s bid.

But with an election looming, South Australia’s economy stagnant, a brace of Liberal politicians including party heavyweights Amanda Vanstone and Alexander Downer calling SA home, and a number of marginal seats, the issue is likely to become political.

Mr Howard has said Opposition Leader Kim Beazley cast the die for WA when he was Defence Minister by setting up the Australian Submarine Corporation in SA.

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