The project to modernise the Defence-owned World War II rifle and gun propellants factory in Mulwala moved another step closer with the signing of a Deed of Cooperation between Defence and ADI, Defence Minister Robert Hill announced today.
Senator Hill said the Deed would govern the management of the Mulwala modernisation and a number of obligations on each party to progress the project. It also affirmed the Government’s commitment to retain for the long term an Australian propellant and high explosives manufacturing capability at Mulwala.
The Mulwala factory in southern New South Wales supplies military-grade propellants and high explosives to the Benalla ammunition manufacturing facility, which is located in northern Victoria.
The Mulwala factory employs about 370 people.
Under the Deed, ADI will be responsible for managing the project. ADI will also submit to Government a privately funded proposal to modernise the facility and the supply of propellant to the Australian Defence Force for 20 years. Defence will assist ADI in evaluating the modernisation proposals, with the Government to consider these in mid-2004.
"This is an important milestone for the project – and will ensure ongoing employment in regional New South Wales and Victoria," Senator Hill said.
"Modernising the factory will ensure that the ADF has a locally-made supply of munitions and that Mulwala has an assured future."
Senator Hill acknowledged the strong support of the Member for Farrer, Sussan Ley, Member for Murray, Sharman Stone, and the Member for Indi, Sophie Panopoulos, for the project.
ADI will now issue a Request for Tender to design, construct and commission a modernised propellant manufacturing facility. It is expected three consortium, headed by large Australian companies and supported by major international technology providers, will submit tenders.
The tender will also explore options for the local production of insensitive munitions, which are less prone to accidental detonation and therefore are safer for use by the ADF.
The Deed was signed at a ceremony in Canberra today by the Commander Joint Logistics, Major General Peter Haddad, and the Managing Director ADI Limited, Lucio Di Bartolomeo.
