Norway selects British-made frigates to beef up maritime defence in $13.5 billion deal

By Nora Buli and Terje Solsvik

OSLO (Reuters) -Norway said on Sunday it had chosen Britain as its strategic partner for the acquisition of new frigates in its biggest ever military investment, in a deal worth some 10 billion pounds ($13.51 billion) to boost the Nordic country's maritime defence.

Germany, France, Britain and the United States had offered rival frigate designs in competition.    

"The frigates are an essential part of our defence because they are key to defend our sovereignty," Prime Minister Jonas Gahr Stoere told a press conference.

Norway is NATO's monitor for the vast 2 million square kilometres (772,000 square miles) area of the North Atlantic used by the Russian northern fleet's nuclear submarines.

A key mission for the frigates will be to monitor Russian submarines, whose base is on the Kola Peninsula, an area in the Arctic bordering Norway.

British Prime Minister Keir Starmer welcomed the deal, which he said was worth 10 billion pounds.

The deal will eventually see a combined fleet of 13 anti-submarine warfare frigates – eight British and at least five Norwegian – operate jointly in northern Europe, he added.

British officials, seeking economies of scale for their own navy and to boost Scotland's shipyard industry, had heavily promoted the BAE Systems' frigates, known as the T-26 City-class.

The deal would support 4,000 jobs across the United Kingdom, including more than 2,000 in Scotland, the British government said.

Norway shares a border with Russia and is ramping up defence spending in light of Moscow's invasion of Ukraine and U.S. President Donald Trump's demand that NATO allies must bolster their own military strength.

The draft agreement with Britain also guarantees industrial cooperation with Norwegian industry equivalent to the total value of the acquisition, the Norwegian government said.

Norway, a nation of 5.6 million people, currently operates four frigates. It previously said it could order five frigates, with an option for an additional one.

"This will be the biggest purchase to date. And we are now entering final contract negotiations," Gahr Stoere said.

($1 = 0.7402 pounds)

(Reporting by Nora Buli and Terje Solsvik in Oslo; additional reporting by Elizabeth Piper in London; editing by Gwladys Fouche and Ros Russell)