Australia will build nuclear-powered submarines as part of a landmark security pact with the United States and the United Kingdom.
Prime Minister Scott Morrison announced the historic AUKUS agreement on Thursday as Australia prepares to scrap a $90 billion French submarine deal.
Mr Morrison said the three “friends of freedom” would launch an 18-month investigation into building nuclear-powered submarines in Adelaide.
“But let me be clear. Australia is not seeking to acquire nuclear weapons or establish a civil nuclear capability,” he said.
“We will continue to meet all of our nuclear non-proliferation obligations.”
UK Prime Minister Boris Johnson and US President Joe Biden joined Mr Morrison to make a joint virtual announcement.
Mr Johnson said the AUKUS pact aims to preserve peace and stability in the Indo-Pacific region.
“We’re opening a new chapter in our friendship,” he said.
“The first task of this partnership will be to help Australia acquire a fleet of nuclear-powered submarines.”
The 18-month consultation period will determine workforce and training requirements, production timelines and safeguards on nuclear non-proliferation agreements.
It will be the first time Australia has acquired submarines with nuclear propulsion systems.
Mr Biden said it was a historic step to deepen and formalise co-operation between the three nations.
“We all recognise the imperative of ensuring peace and stability in the Indo-Pacific over the long-term,” he said.
Mr Morrison said it was a next-generation partnership, built on a strong foundation of trust.
“We have always seen the world through a similar lens,” he said.
“We have always believed in a world that favours freedom, that respects human dignity, the rule of law, the independence of sovereign states and the peaceful fellowship of nations.”
Chinese Washington embassy spokesman Liu Pengyu said countries should not build exclusionary blocs targeting or harming the interests of third parties.
“In particular, they should shake off their Cold War mentality and ideological prejudice,” he said.
There had been mounting speculation Australia would end its French submarine deal, which has been plagued by delays and cost blowouts.
The 2016 agreement contracted French shipbuilder Naval Group for a new fleet to replace Australia’s ageing Collins Class submarines.
The deal involved building 12 new submarines in Adelaide, with the first of the new vessels to enter service around 2035.
Mr Morrison is due to travel to Washington next week for a meeting of the Quad alliance of the US, India, Japan and Australia.
It will be his first US visit since Mr Biden became president.
Defence Minister Peter Dutton and Foreign Affairs Minister Marise Payne are already in Washington for the 31st annual Australia-US Ministerial Consultations, or AUSMIN.
Federal cabinet ministers were summoned to a secret meeting in Canberra on Wednesday ahead of the AUKUS announcement after being granted border exemptions to enter the ACT.
Opposition Leader Anthony Albanese and three other members of his front bench also received briefings.