After years of doubt and speculation, the Northern Territory’s chief minister says Darwin’s embattled ship lift facility is out of financial strife and could see large vessels docking for repairs by the end of 2026.
The half-a-billion-dollar NT government project at Middle Arm has seen significant delays and cost blowouts since it was announced almost a decade ago.
But amid an increasingly unstable geopolitical environment and the federal government’s commitment to strengthening defense in the north, experts have welcomed the ship lift, saying it is critical.
The plans almost collapsed in 2022 when Perth-based construction firm Clough — which was designing and building the ship lift — entered voluntary administration.
But on Tuesday, Chief Minister Eva Lawler announced a $48 million contract had been awarded to US company Pearlson Shiplift Corporation to develop major systems for the project, and defended outsourcing the work overseas.
“Our government very much is focused on local providers,” Ms Lawler said.
“But in this case, there wasn’t a company that was able to provide [the necessary] components for the ship lift, so we had to go to an international provider.”
‘We think it will be a money maker’
In 2015, the NT government promised $100 million for the project, with some support from the private sector.
The cost ballooned to $400 million in 2019, then, in 2022, the NT government conceded there would be another increase to $515 million.
The project is also backed by $300 million from the North Australian Infrastructure Facility (NAIF).
Despite the new multi-million-dollar contract awarded to Pearlson, on Tuesday the chief minister was adamant there would be no further cost overruns to the project.
She also defended the significant delays — with the project initially set for a two-year build, expected to begin in 2017 — and questions about the project’s value for taxpayers.
“There have been design delays, [and] as well we’ve had COVID … there was also then, prior to that, work around the actual site and what’s the best use,” she said.
“[Ship lifts] are in demand in the north of Australia for patrol boats, defense vessels, but also for our fishing fleet.
“We see it as an industry that’s going to grow across Australia, grow worldwide.
“We think it will be a money maker.”
No firm commitment on critical defense deals
This week, one of the navy’s largest ships docked at Coonawarra, the Royal Australian Navy base in Darwin’s CBD, for the first time.
While slightly too large for the planned ship lift, it is vessels like these the NT government is hoping will use the facilities for repairs and maintenance, if it can secure deals.
When built, it is slated to be able to lift vessels up to 5,500 tonnes in and out of the water.
Chief Minister Eva Lawler on Tuesday said the government was “in discussions” with the Department of Defense and had a “strong commitment” from them to use the ship lift, but was unable to confirm a deal.
Victor Abramowicz, a defense and security expert from Charles Darwin University, said the infrastructure was critical for Australia’s security.
“It is in many ways a response to changes in the geopolitical situation, but while I don’t think there’s necessarily an immediate threat, it’s an important part of strengthening defense infrastructure around the country,” he said.
“It will increase resilience and increase our abilities to support both the ADF and various allies and partners.”
Right now, large defense and allied vessels need to travel elsewhere in the country to have any major repair works done, Dr Abramowicz said.
“There’s a hell of a lot of marine traffic throughout the waters here and to the north and Indonesia, so the ship lift really is going to provide an ability to do major maintenance on a whole range of defense and commercial and private vessels,” he said.
“I would really think that you’re going to see a lot of return for the taxpayer, both locally and nationally, in the years ahead, once this is operational.”
Deputy opposition leader Gerard Maley said while the Country Liberal Party backed the project going ahead, the delays were a concern.
“Project delays are expensive,” he said.
“The longer the project is delayed, the cost overrun starts to increase at an exponential rate.
“The opportunity cost also makes the territory less competitive.”
Maurie McNarn, chairman of the Norsta Maritime Board, said the NT “cannot afford to wait any longer” for the project.
He is calling on the government to invest in an interim, smaller ship lift to meet current demands, as boats currently need to travel to facilities in Perth, Cairns or Singapore.
“The National Defense Strategy and the Surface Fleet Review offer the NT huge opportunities, but without enabling infrastructure, these opportunities will be lost,” Norsta said.
“Once gone, the work and the trades will be hard to recover and rebuild.”
Asked about the proposal on Tuesday, Ms Lawler said she was determined to focus on the project at hand.
“We’re determined to have a high-quality ship lift here in Darwin, and that’s the work that’s underway,” she said.
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