2.1
The Department of Defence (Defence) seeks approval from the Committee to proceed with the Engine Test Cell 1 Upgrade Project. The proposed works will enable efficient kitting and testing of the existing fleet of F/A-18F Super Hornet and EA-18G Growler engines and the new F-35 Lightning II engines at RAAF Base Amberley, Queensland.
2.2
In 2014, the Australian Government approved the acquisition of 72 F-35 Lightning II aircraft to replace the current fleet of 71 F/A-18 classic Hornets. The F-35 fleet was acquired under a Global Support Solution model. This means Australia shares the responsibility for providing access to spare parts, maintenance services and support equipment with eight other partner nations: United States (Project Lead), United Kingdom, Italy, Netherlands, Turkey, Canada, Denmark and Norway.
2.3
The proposed works will enhance the existing engine test cell at RAAF Base Amberley – so in addition to being able to continue to test F/A-18F Super Hornet and EA-18G Growler engines it can service the new F-35 engines. This will be the fourth location in the world where F-35 engine testing can occur and the only F-35 testing facility in the Southern Hemisphere until 2023. Engines will be interchangeable amongst the F-35 global fleet. Engine testing is part of the maintenance services that Australia is required to provide under the Global Support Solution.
2.4
The estimated cost of the project is $23.7 million (excluding GST).
2.5
The project was referred to the Committee on 7 December 2017.
Conduct of the inquiry
2.6
Following referral, the inquiry was publicised on the Committee’s website and via media release.
2.7
The Committee received two submissions and one confidential submission.
2.8
On 30 January 2018, Defence conducted a site inspection for the Committee. On the same day, the Committee also conducted a public and in-camera hearing. A transcript of the public hearing is available on the Committee’s website.
Need for the works
2.9
Engine maintenance and testing is contracted out to industry by Defence’s Capability Acquisition and Sustainment Group. The engine test cell is currently used to test the RAAF’s fleet of F/A-18F Super Hornet and EA-18G Growler aircraft. The manufacturer of the Super Hornet and Growler aircraft is General Electric International Incorporated (GEII) who operates as the Prime Contractor for the engine test cell facility.
2.10
GEII subcontract to TAE Aerospace (TAE) who performs the actual maintenance and testing of engines. However, the manufacturer of the new F-35 engines is Pratt & Whitney (P&W).
2.11
In its submission, Defence explained:
…as the products from two competing [manufacturers] are to be tested in one facility, equipment and information categorised as Intellectual Property needs to be segregated whilst not hindering efficiency.
2.12
In its submission, Defence states that in December 2014, the United States F-35 Joint Project Office (JPO) announced that Australia had been successful in securing the opportunity to host an Asia-Pacific regional F-35 Engine Maintenance, Repair, Overhaul and Upgrade Depot.
2.13
It was later realised that without modification, the existing engine test cell at RAAF Amberley would not be able to support F-35 engine work due to the larger size, weight and significant increase in power of the F-35 engine compared to the F/A-18F Super Hornet and EA-18G Growler engines.
2.14
At the public hearing Defence explained:
The key differences between the F-35 engine and those currently tested at the engine test facility are that the manufacturer is Pratt & Whitney rather than General Electric and the engine is 50 per cent longer, three times heavier and produces double the thrust. […] The engine test cell upgrade is a key component required to support the F-35 global support solution partnership. In turn, the global support solutions partnership is a critical component of the F-35 Joint Strike Fighter capability.
Scope of the works
2.15
The proposed upgrade of the engine test cell will enable post-maintenance testing of the F-35 engine. The scope of works is split into seven functional areas.
Control room 1 (to be used by GEII). Will be refitted to remediate age-based defects inclusive of the slope that has developed to the floor and to remove the current window panel between the control room and the test cell. The room will be fitted with new services and furniture and lined with acoustic panelling appropriate to its location.
Control room 2 (to be used by P&W). Will be established in place of the current kitting space incorporating the same provisions as Control Room 1 and a separate communications room for company proprietary server equipment. The room will be fitted with new services and furniture and lined with acoustic panelling appropriate for its location.
Segregation between different engine manufacturer spaces. The space between the two control rooms will become a common access lobby. For the purpose of protection of intellectual property of the manufacturers, the remainder of the facility will be designed to limit access by one manufacturer to the other’s space. This segregation will extend to each manufacturer’s access to the common test cell when occupied by the other, including the ability to access the cameras mounted in the test chamber.
Kitting Facility. The kitting facility is used for receiving engines by truck and mounting them to support frames that hold them in place for testing. Once fitted to the support frames, engines are moved from the kitting facility into the test chamber. The kitting facility is an extension of the existing building. It will be fire-isolated from the test cell building. It will have two direct vehicle access points for engine delivery and a rail-based connection to the test cell to allow for engine movement within the facility.
Test Cell. Modifications will be made to the test cell to achieve noise attenuation and compliance with fire safety regulations. Access to the test cell chamber will be via new doors at the end of the test cell. The height and width of the existing doorway will be increased to enable movement of the F-35 engine into the test cell. Airflow turning vanes will be installed to satisfy the increased inlet airflow requirements of the F-35 engine. The floor will be upgraded to accommodate the new rail-based engine movement system. New emergency egress points will be added to the test cell building and the exhaust building.
Trailer store. The trailer store will be an enclosed garage structure for four trailers used to support engine movement. The building will be metal clad and lined with bird mesh.
Amenities/Lunch Room. The amenities/lunch room will be modified to achieve compliance with the Disability Discrimination Act. This includes increased doorway widths. Minor repairs and grading will be undertaken on existing paths external to the lunchroom building.
Cost of the works
2.16
The total estimated cost of this project is $23.7 million excluding GST. This includes construction, design, ICT, preliminaries, contingencies, escalation and management costs.
2.17
The Committee received a confidential supplementary submission detailing the project costs and held an in-camera hearing with Defence on the project costs.
2.18
The Committee is satisfied that the costings provided to it have been adequately assessed by the proponent entity.
Local impacts
2.19
The Committee received evidence from Defence outlining the nature and extent of community consultation undertaken as part of the proposed project.
2.20
Defence reported that the community were interested in noise, vibration and employment opportunities.
2.21
At the public hearing, Defence informed the Committee there was no indication of any noise complaint relating to the engine test cell in the last two years.
2.22
Defence told the Committee:
For this engine test cell facility, as it comes online to test the new F-35 engine, we’re looking at one test per fortnight to start off with. That may increase as more engines come online but probably not any more than one or two tests per week. The testing periods are between two to five hours. It is at the two hour mark where the actual engine is completely fired up – where noise does go beyond normal levels [….] the amount of frequency, and amount of noise that comes is not beyond what is currently coming off the base on a routine basis.
2.23
Defence further clarified ‘there is no greater noise footprint that would emanate from this relative to jets taking off and landing at the RAAF base’.
2.24
In the Community Consultation Report, Defence agreed to ‘consider ground vibration measurement due to engine testing and to communicate actions and outcomes relating to this matter through the Amberley Consultative Working Group’.
2.25
In its submission, Defence stated:
It is anticipated that the project will generate employment opportunities, predominantly in the building construction, labour and supply markets from within the areas in close proximity to the Ipswich region.
2.26
Defence explained that RAAF Base Amberley has a program to engage with local industry and businesses.
As far as employment opportunities around the local area go, the prime contractor being TAE, for the construction of the works is expecting to let anywhere around 40 trade packages of work. At any one time we expect there’d be up to 70 people employed on the site. Over the course of the 12 to 14 month construction period about 120 people will be employed. As far as small and medium enterprises go, we’re expecting that it’d be anywhere up to around 70 per cent of those trade packages, which would be of a level of complexity and size that would be something that an SME would be able to competitively bid on. The other 30 per cent is much larger works where it might be beyond an SME. But the TAE is certainly focused in making sure we maximise those opportunities for small and medium enterprises around the local area to have a look in for it.
They’ll also be working closely with chambers of commerce and industry players around the local area, so there's a good awareness of what’s coming up, and they can be prepared to be bidding for the work.
2.28
The Committee requested that in the project post-implementation report Defence provide details about the success of work packages and numbers relating to projected and actual employment outcomes.
Environmental
2.29
In its submission, Defence stated that a report was commissioned that assessed environment and heritage considerations for the proposed project; and that the report found no matters of environment or heritage significance that would trigger a referral in accordance with the Environment Protection and Biodiversity Conservation Act.
2.30
There are contaminants at the site including per- and polyfluoroalkyl substances (PFAS) including perfluorooctane sulphonates (PFOS) and perfluorooctanic acid (PFOA).
The concentrations of contaminants in the soil have been measured against ecological screening levels. Contaminants have been identified in shallow soil which means run off from the site will need to be managed during construction to prevent soil migrating to nearby Warrill Creek. Warrill Creek is approximately 100 metres from [the facility], outside the base boundary fence. Defence will require the construction contractor develop a soil and sediment management strategy, and incorporate this into their Construction Environment Management Plan.
2.32
Defence elaborated on how PFAS was being managed at RAAF Base Amberley:
The testing to date has shown that the levels of PFAS are upper-low, the limit for what is harmful to humans. That is not stopping us, though, from continuing to test throughout and to take measures to make sure that there is no potential run-off into neighbouring Warrill Creek, which is only about 80 metres away from the current construction site.
On Amberley, as you would be aware, there is a number of other construction jobs going on there. Currently, regardless of the level found in the soil, we are not actually removing it. It is either being reused or stored in an appropriate fashion on the base. At the moment that would be the plan for the project we are proposing.
Committee comment
2.33
The Committee recognises that the proposed works are essential to the delivery of Australia’s air combat capability. Providing engine testing in Australia and being part of the F-35 Global Support Solution is more affordable than purchasing aircraft off the shelf.
2.34
The Committee understands that the $23.7 million proposed works are a small but crucial requirement of the overarching air combat capability project that is valued around $1.48 billion.
2.35
The Committee notes that the last upgrade to the facility was in 2010 to meet the needs of Super Hornet and Growler aircraft engines – that are expected to stay in operation until at least 2030. The proposed works will enable to testing of the new F-35 Lightning II aircraft engines while retaining the capability to test the Super Hornet and Growler aircraft engines. The Committee notes that other engine test cell facilities around the world are generally limited to one engine type – so the proposed facility has a greater scope for productivity.
2.36
Having regard to its role and the responsibilities contained in the Public Works Committee Act 1969, the Committee is of the view that this project signifies value for money for the Commonwealth and constitutes a project which is fit for purpose, having regard to the established need.
2.37
The Committee recommends that the House of Representatives resolve, pursuant to Section 18(7) of the Public Works Committee Act 1969, that it is expedient to carry out the following proposed work: Engine Test Cell 1 Upgrade, RAAF Base Amberley.
2.38
Proponent agencies must notify the Committee of any change to the project scope, time, cost, function or design. The Committee also requires that a post-implementation report be provided within three months of project completion. A report template can be found on the Committee’s website.