Austal Limited (ASX:ASB) is pleased to announce that Austal USA has been awarded a US$156,171,650 (~A$225.5 million) fixed-price incentive contract option from the United States Navy for the construction of two Navajo-class Towing, Salvage, and Rescue Ships (T-ATS 13 and 14).

With the award, the company is now under contract for four T-ATS, having received awards for T-ATS 11 and 12 in October 2021.

Austal Limited Chief Executive Officer Paddy Gregg said the latest contract award re-affirmed the United States Navy’s great confidence in Austal USA’s capabilities as a steel shipbuilder, following the start of construction on T-ATS 11, earlier this month.

“It’s a great sign of confidence by the Navy, in the Austal USA team’s ability to deliver both steel and aluminium ships simultaneously, that they have awarded a contract for another two vessels.

“Congratulations to the Austal USA team on yet another multiple steel vessel contract, which will go even further to demonstrate the company’s diverse capabilities, in aluminium and steel.”

T-ATS is an ocean-going tug, salvage, and rescue ship designed to support the United States Navy’s fleet operations, with a multi-mission common hull platform capable of towing heavy ships. The ships are capable of supporting a variety of missions, including oil spill response, humanitarian assistance, search and rescue and surveillance.

Austal USA will utilize its proven ship manufacturing processes and innovative methods that incorporate lean manufacturing principles, modular construction, and moving assembly lines, all housed under the company’s state-of-the-art enclosed steel production facility. This unique production capability positions Austal USA to meet the ongoing, growing demands of both the Navy and Coast Guard.

Construction on T-ATS 13 and 14 will commence in the second half of CY2023 and first half of CY2024; with delivery planned for the second half of CY2025 and first half of CY2026, respectively.

In addition to T-ATS, Austal USA is currently constructing the United States Navy’s Independence-variant Littoral Combat Ship and Spearhead-class Expeditionary Fast Transport and is under contract for the construction of a 211 metre steel Auxiliary Floating Drydock Medium. The company was also recently awarded a contract for up to 11 steel Offshore Patrol Cutters for the United States Coast Guard, worth up to US $3.3 billion.

This ASX announcement has been approved and authorised for release by Paddy Gregg, Austal Limited’s Chief Executive Officer.