The Australian Department of Defence (DOD) has terminated a contract with Phoenix International Australia for the supply of a deployable submarine rescue system (SRS).

The SRS contract, valued in excess of $255m, was awarded to the company in December 2018.

The company was to play a lead role in delivering the new submarine rescue system along with several small and medium Australian companies.

The SRS, which would have been one of only four air transportable systems in the world, was intended to support the capability requirements of the Royal Australian Navy (RAN).

It was being procured for both the Collins Class submarine force and the Attack Class submarines.

The system can be quickly deployed in support of a distressed submarine anywhere in Australia’s area of operation.

The DOD noted a series of delays to be the reason behind the decision to cancel the contract.

It is based on the outcomes and recommendations of an independent review of the project initiated by the department in August last year.

The parties will now work to conclude the contract termination settlement, including dealing with the arrangements with Phoenix and its subcontractors.

The DOD and the Department of the Prime Minister and Cabinet are investigating to inform ‘lessons learnt into procurement practices and relevant accountabilities’.

Under its current contract with James Fisher Defence Australia, the RAN holds a suitable SRS that can be sustained into the late 2020s for the Collins Class fleet.

In the meantime, the Australian Government will explore the feasibility of acquiring a replacement system.