General Dynamics‘ (NYSE: GD) NASSCOÂ subsidiary has received a potential $3.2 billion contract from the U.S. Navy to design and buildÂ six replenishment oilers.
The Defense Department said Thursday the contract has a base value of $640 million for the initial T-AO 205 class fleet replenishment oiler, whichÂ could be followed byÂ one ship per year from fiscal 2018 to fiscal 2022 if funds are appropriated.
DoD added the contract covers line items for five follow ships and contains options forÂ provisioned item orders, special studies and engineering, industrial, contract design, cost reduction and implementation support services, among others.
Work will occur in Mexico and in California, Michigan, Virginia, Wisconsin, Louisiana, Oregon, Â Massachusetts and other locations throughÂ July 2020 for the first ship andÂ July 2025 for the rest of the replenishment oilers.
The Naval Sea Systems Command will obligate the base contract amount at the time of the award from the Navy’s fiscal 2016 shipbuilding and conversion funds.
Replenishment oilers work toÂ resupplyÂ fuel, fleet cargo and stores to customer ships at sea.