Govt awards $446 million defence contract

A $446 million defence contract has been awarded to Lockheed Martin, the Government announced today.

The contract was for a frigate combat systems upgrade, including new radars, electronic detection and other above water systems, the self-defence missile system, decoys against missiles and torpedoes, and an upgrade to the hull-mounted sonar.

Defence Minister Jonathan Coleman said HMNZS Te Kaha and HMNZS Te Mana were nearly 20-years-old and it was important to update their self-defence and sensor capabilities systems to a standard comparable to the frigates used by Australia, Canada and the UK.

"Our international partners place a high value on New Zealand's ability to deploy a credible maritime combat force into the Pacific and further afield.

"Earlier this year, HMNZS Te Mana made a valuable contribution to international anti-piracy efforts in the Gulf of Aden, working closely with a range of partners including the US, EU and NATO.''

The cost of the upgrade was being funded from within the existing NZDF's baseline as part of the Defence Capability Plan, Dr Coleman said.

"Following a robust and competitive tender process Lockheed Martin Canada was selected as the most suitable and cost effective tenderer.''

The company had valuable experience after undertaking a similar upgrade of the Canadian Navy Halifax Class frigates, he said.

Te Kaha and Te Mana were designed in the late 1980s and introduced into service in 1997 and 1999. In November 2012 Cabinet approved the business case to upgrade the self-defence and sensor capabilities of the frigates.

The majority of the work would be completed in Canada and included the procurement and integration into the ships' combat system of key sensors.

Lockheed Martin Canada was also working with New Zealand Trade and Enterprise to scope a range of potential opportunities for local companies to support the project, Dr Coleman said.

The final design work for the combat systems upgrade would commence shortly. The upgrade was scheduled to begin in 2016.

The frigates are currently undergoing a platform systems upgrade to modernise heating, ventilation, propulsion and stabilisation systems.