Speculation about South Australia’s mooted role in building eight nuclear-powered submarines at the Osborne Shipyards is rife ahead of a formal announcement expected on Tuesday.

International media yesterday reported a series of unconfirmed leaks suggesting Australia would buy up to five US submarines from the 2030s, with the Financial Review this morning reporting that those vessels would be “rebadged” existing Virginia-class models with yet-to-be determined price tags.

The reports call into question the role South Australia will play in the trilateral AUKUS security partnership with the United States and United Kingdom, following the scrapping of an original French submarines deal with Naval Group.

According to Defence SA, the state government has already started preparatory work for the construction of “at least eight” nuclear-powered submarines at Osborne.

But when asked on ABC Radio Adelaide this morning if all eight nuclear-powered submarines would be built in South Australia, Malinauskas did not provide confirmation.

“I have every confidence – and I’ve spoken to the Prime Minister about this on multiple occasions as recently as a couple of weeks ago – that we will be building nuclear submarines here in Adelaide and the Commonwealth will be honouring its commitment in full,” the Premier said.

Pressed on whether the Commonwealth had committed to a specific number of submarines being built in Adelaide, Malinauskas reiterated that once production lines were established in Adelaide, submarines would continue to be built.

“The most important submarine that comes off the line is the first and the reason why I say that is because there is not an example anywhere in the world of any nuclear submarine production line starting and then stopping,” he said.

“Once you start producing nuclear submarines, you keep producing nuclear submarines.

“My hope is that we end up producing a lot more than eight nuclear submarines here in South Australia.”

Asked at a press conference later this morning if it would be a “broken promise” if South Australia was tasked with building less than eight submarines, Malinauskas said: “I don’t think that would be an unreasonable characterisation”.

“If South Australians had to endure a broken promise of that scale then I would do everything within my power to hold those responsible to account, regardless of their politics,” he said.

“My hope and my ambition is that the Commonwealth doesn’t commit to eight, but it commits to building them forevermore.”

In the meantime, Defence Teaming Centre CEO Audra McCarthy said the local industry was “nervously waiting” for the announcement, when Prime Minister Anthony Albanese meets with US President Joe Biden and UK Prime Minister Rishi Sunak in the US on Monday.

McCarthy told InDaily that when the AUKUS partnership was announced in 2021, she questioned what it would mean to have submarines built in South Australia.

“At the time, I went on record to say: ‘What does build look like? Define ‘build’? What does that mean?’ And we never had any response or anything back,” she said.

“On one hand, we have politicians saying: ‘They will be built here’, but when and how many?

“We have industry who are off the back of a cancelled program and are waiting for an announcement of dates.”

McCarthy said South Australia’s defence industry was now facing a “valley of death”, with companies unable to plan their cashflow or resources while they waited for certainty.

“We have one member who has been involved in defence supply chains and was positioning for shipbuilding quite heavily and they went into liquidation two weeks ago,” she said.

“There are several other members we have… who invested significantly into positioning for the future submarine program and lost a lot of money just by pursuing those opportunities when the contract with Naval Group was suddenly pulled.

“It’s now been almost two years since that announcement and even if they were to make an announcement miraculously today to start building, by the time you complete the design process we’re still five to 10 years for those companies to have any work orders issued to them.

“It’s between feast and famine.”

McCarthy predicted more defence companies would exit the industry, which she said would cause “serious” problems for the state and federal governments.

“When they do decide they want industry to step up, there won’t be any industry available to step up because they will have all moved into other sectors,” she said.

“They won’t have the certifications and the qualifications they need to be able to operate in those supply chains.”

The federal government in 2021 approved a Life of Type Extension to Australia’s existing six Collins class submarine fleet from 2026 in South Australia, and confirmed that the full-cycle docking of the Collins class would continue to be conducted at Osborne.

The upgrade work – to cost up to $6.4 billion – was approved to avoid a capability gap while Australia waited for the nuclear-powered submarines to be built.

It’s unclear if the Life of Type Extension would continue if Australia purchased American submarines.

“The Life of Type Extension program is tied to the dates and ages of the vessels of the Collins, so depending on what dates we can get the Virginias in the water and in service and operable will determine whether that life-of-type extension will go ahead,” McCarthy said.

“If we’re sustaining a Collins class submarine (fleet) and a Virginia class submarine (fleet), we’d have to train for those different platforms.

“The Navy established a strategy a few years back that it wanted to simplify and standardise its platforms to reduce its sustainment and operational costs and potentially this decision can undo all that and complicate things and drive costs again for the Australian taxpayer.”

South Australian federal Liberal MP James Stevens warned of “enormous uncertainty” and “frightening economic consequences” for the state’s shipbuilding industry.

He called on the federal government to guarantee the full life-of-type extension for all six Collins class submarines.

“Five submarines’ worth of jobs are destined for another country’s economy and the impact of this uncertainty will rightly strike fear into the workforce and businesses throughout the sector,” he said.

“The Coalition initiated AUKUS and the opportunity to acquire nuclear-propulsion submarines. We strongly support a rapid acquisition of this capability. We equally support a consistent, reliable and continuous sovereign shipbuilding capability centred in Adelaide.”

Malinauskas told reporters that he expected the Life of Type Extension work would continue on the Collins class submarines.

He said he didn’t believe that purchasing Virginia class submarines would negate the need to continue the Life of Type Extension work.

“The Commonwealth needs to make sure that our submarine capability is ongoing from our nation’s security perspective and the Collins class is central to that endeavour,” he said.

“Everything about the submarine program – whether it be the current Collins class program and the future program is about maintaining Australia’s position in the world and our sovereign capability to be able to project our defence forces.

“We keenly await the details that are to be announced by the Prime Minister in the coming days.”

Malinauskas also denied the industry was facing a “valley of death”.

“If the announcement next week from the Prime Minister delivers on the commitments to South Australia, this won’t be a case of South Australia looking for work – it will be a case of looking for workers to do the work that is required,” he said.