Why the Philippine Navy Dropped the Maestrale-class?

Many were surprised by the sudden move by the Philippine Department of National Defense (DND) and Philippine Navy (PN) to discontinue negotiations with the Italian government for the possible purchase of two Maestrale-class frigates. The ship’s presence and size will immediately make it the PN’s largest surface combatant, while the technological aspects, although not the most modern in the market, is still miles ahead from what the PN has, and what its organization can handle.

ITS Maestrale, lead ship of the Maestrale-class frigates of the Marina Militare

Let us look at what the Maestrale-class has to offer:

At around 123 meters long and a displacement of well over 3,000 tons, the ship is bigger than the PN’s largest surface combatant the Gregorio del Pilar-class. It is powered by two diesel engines and two LM2500 gas turbine engine in a CODOG configuration for rapid movements (good for hunting and evading submarines). Although the PN has at least 2 years experience with a CODOG-configured ship, the presence of the LM2500 gas turbine is a technological leap on its own. The General Electric LM2500  is one of the world’s most widely used marine gas turbine engine, powering most allied warships and is much modern than the PN-used Pratt & Whitney FT4A-6 gas turbines on the Gregorio del Pilar-class. This powerplant propels the Maestrale-class to a maximum of 33 knots, or at least 3 knots faster than the most modern US Arleigh Burke destroyers and most large surface combatants in the region.

The ship has a wide array of sensors, which include the RAN-10S air & surface search radar, a separate SPS-702 surface search radar and SPS-703 navigation surveillance radar, 3 fire control radars for the guns and missiles, a hull mounted and towed array sonar on Raytheon ASW suit, jammers and signal interceptors for ESM & ECM, a Nixie towed torpedo decoy and SCLAR missile decoys, and a Prairie Mask air bubbler sound suppression system. 

A typical Furuno radar antenna, similar to most radar antennas in PN ships

Compared to the Gregorio del Pilar’s AN/SPS-73 and Furuno FAR-series short range surface search and navigation surveillance radar s and a single Mk.92 gun fire control radar, it’s like comparing durian to apples.

Weapons-wise, the Maestrale-class are armed with four Otomat Teseo anti-ship cruise missiles, an octuple Albatross launcher for 8 Selenia Aspide medium range anti-aircraft missile plus 16 reloads, two twin 40mm guns with DARDO close-in weapons system, a 127mm Otobreda main gun, 2 triple lightweight anti-submarine torpedo tubes for 6 torpedoes, a helideck and fixed hangar for 2 medium ASW helicopters. 

Again, comparing to the Gregorio del Pilar-class which has no missiles, no torpedoes, a 76mm Compact main gun, a 25mm Mk.38 Mod.0 gun and two 20mm Mk.16 guns, a helideck and a telescopic hangar not even enough for a medium sized helicopter. Hands down the Maestrale-class wins.

The ships are offered to the Philippine Navy for almost Php 6 billion each, including refurbishing works “zero timing” (whatever that specifically meant, haven’t heard zero timing a ship in my lifetime) of the ship’s hull and superstructure, gas turbine and diesel engines, and all other items; replacement of worn out and outdated systems; training of crewmen & provision of support teams from Italy (which are said to be joining the ship to the its trip home, and will be staying in the Philippines for several months), and full-load ammunition.

Beside all these, the Italians are willing to spice up the deal by providing freebies in the form of other Italian Navy ships for decommissioning, like the Artigliere-class frigate, Minerva-class corvettes, and Lerici-class minehunters. Italian media confirms this possibility quoting senior Italian officials without saying a specific country for a possible program but looks likely they were talking about the Philippines or a South American country, probably Peru.

So why drop the chance?

The DND said their studies found out that the cheap purchase cost plus maintaining and operating the older ships are much expensive in the long run that buying newer ships plus maintaining and operating them in the long run. That makes sense, but I think even primary schoolchildren knows that too. But just basing it on that reason does not add up. MaxDefense believes that the reason is deep rooted, although there are several other possibilities that we can think of:

1. The problem is not the Maestrale ships themselves, but two other ships far from Italy. I'm talking about the BRP Ramon Alcaraz (PF-16) in South Carolina and BRP Gregorio del Pilar (PF-15) in the Philippines. In our previous blog about the Ramon Alcaraz, MaxDefense believes that the Philippine Navy encountered structural, electrical and mechanical problems in both ships either wear & tear, obsolescence or damage, which may have or will affect their operational capability and readiness, as well as keep the ships to port too often. PF-15 may have only encountered the problems after commissioning, while PF-16 may have found such problems while still on port in Charleston, South Carolina. This might be the basis of DND's statements on costs maintaining & operating older ships.

The BRP Ramon Alcaraz is still in Charleston, North Carolina since May 2012. What could have the PN  found?

2. Another possible reason might be the Maestrales themselves. The ships may be too expensive for their age and the DND wanted some pricing or deal adjustment. Php 6 billion for each ship seems cheap compared to other similar types in the used warship market. But with the limited budget of the DND , it needs to push more for its money. MaxDefense sources indicate that the DND wanted a better package than what the Italians are offering for the same price, especially regarding the air defense suite and replacement of older systems like fire control systems, although no exact details were made available.

Is the Albatross-Aspide anti-aircraft missile system still effective for the PN's requirements?

3. Might there be a better offer made by somebody else? MaxDefense sources said that South Korea's Hyundai Heavy Industries (HHI) made a very juicy offer when the Maestrale deal was still ongoing. HHI reportedly offered a derivative of the Incheon-class frigate at around Php 9 billion each (incidentally this is the new budget of the PN for a new frigate). Perhaps the DND and PN were enticed to go for new instead of old by adjusting their budget. MaxDefense sources indicate that the additional Php 6 billion allocated for both ships will be taken from other naval projects as well as an additional budget coming from the Office of the President's emergency - discretionary funds or Malampaya Special Account (Fund 151). 

Was the Incheon-class (above) the reason for the change of heart?

4. Then there is the issue regarding training. MaxDefense sources indicate that the ship's technological aspect is too much for the PN to handle, and a comprehensive and continuous training program is being requested by DND & PN with the Italians. The Italians offered a compromised training & support package which has a shorter duration than what the PN requested,  but it seems the DND/PN request was so extensive to the point of temporarily stationing Italian specialists in the Philippines for a year or more. For the Italians to agree require a higher sum, which is not in DND's budget, thus declining the entire deal altogether. So far this is the most logical and clearest reason we found so far, although we're still digging for details until now even if this issue has been closed.

The Maestrale-class' RAN-30X radar (above) is said to be too advanced for  the PN's radar operators, thus requiring more training

5. A political reason is also present. There are MaxDefense sources pointing out that the PN is concerned on the inconsistent political continuity of the Philippines' political system, and although the current Aquino administration is supportive of the armed forces' cause to modernize, the next administration may not. Since the Maestrale purchase is just to bridge the a short to medium term capability gaps, a non-supportive government after Aquino may stall the PN to just the Maestrales. Thus it would be best to make use of the opportunity to get what they really need now just in case the future does not look bright for them.

Coming back to the first reason regarding higher operating and maintenance cost of older ships, the PN may have considered that increase of operating and maintenance budget may not happen should a non-supportive administration takes over in 2016. Having newer ships will lessen the dependency on such budgets, thus keeping the savings on other requirements of the navy.

Philippine President Benigno Simeon "Noynoy" Aquino III (right) with his Korean ex-girlfriend Grace Lee.
Will the next president be as supportive to the armed forces as Aquino? Who knows.

In any way, MaxDefense believes that the DND should not close its doors in getting excess defense articles for the sole reason of saving from more expensive operating & maintenance costs. It has  to consider that used items can still be effective depending on the condition of the item, the cost of the deal, and according to the capacity of the Philippine government to purchase & provide budget. EDA's can also act as force multipliers and quick relievers since they can be made available immediately, and the initial costs will always be lower. It is still the fastest way to get hulls in the water to fulfill the capability gaps especially in the face of territorial disputes in the South China Sea.

Turkey, Mexico, Pakistan, Egypt, Bahrain all bought EDA Oliver Hazard Perry -class frigates. Malaysia, Thailand & Taiwan are also considering them too. Why not the Philippines?

Even more progressive countries still make do with EDA's even if they can afford brand new. Countries like Chile, Mexico, Turkey, Greece, Portugal & Belgium bought used frigates like ex-USN Oliver Hazard Perry-class, ex-RN Type 22 Broadsword-class and ex-Dutch Karel Doorman-class, Jacob van Heemskerck-class & Kortenaer-class frigates. Singapore bought several old ex-Swedish Sjoormen-class and Västergötland-class submarines as their first subs. So it is not entirely impossible for the PN to have used ships in its arsenal if they can still be found cost-effective.

Singapore's Archer-class submarines are former Swedish Navy Vastergotland-class, they are old but are found to be cost-effective.
(photo courtesy of Singapore Ministry of Defence)

Besides the Italians, previous announcements of EDAs on offer are the following: Spain's Descubierta-class corvettes, France's Georges Leygues-class frigates and D'Estienne d'Orves-class corvettes, American Oliver Hazard Perry-class frigates, German Type 122 Bremen-class frigates, and South Korean Ulsan-class frigates and Pohang-class corvettes.

With the impending purchase of new frigates, it would be expected that the availability of combat-capable frigates will be pushed back for several years as these new assets will not be available up until around 2016-2017 (if a contract can be signed within 2013). The PN will have to do with its current assets, or will adjust to achieve its requirements in the short-term.

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MaxDefense' suggestion is for the PN to acquire the Maestrale-class frigates as a short-medium term capability gap bridge, without upgrading major systems for now. At less around US$ 35 million each (ship only, no ammunition) plus support/training package, it is still worth the buy. Use Fund 151 and maximize the chance of getting cheap ships while it can. At the same time, acquisition of new frigates must continue to address medium-long term capability requirements. Besides the Maestrale-class. there are also other frigates & corvettes in the used defense articles market worth looking at, as well as support ships like mine countermeasures vessels, amphibious assault ships and replenishment vessels - all these types are needed by the PN someway or another.

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Where are you BRP Ramon Alcaraz?

The BRP Ramon Alcaraz (PF-16) was handed over by the US Coast Guard to the Philippine Navy on May 2012, or almost a year ago. DND says our men need more time to train and to install modern radar. Its quite amusing but MaxDefense think its not the case. Its sistership BRP Gregorio del Pilar was handed over to the PN on May 2011, but how come it was already home by August 2011 or only 3 months after hand-over, including the almost 1 month travel from California to Philippines and stop overs at Hawaii and Guam? 

The BRP Ramon Alcaraz (PF-16) docked at Charleston, North Carolina

This blog is for enlightening the public since the announcements made by the DND & PN seems to cover something. MaxDefense would only like to clarify for the truth, and not to discredit DND, the PN or the BRP Ramon Alcaraz crew members.

Whats the difference with Ramon Alcaraz and Gregorio del Pilar? The PF-16 already has an advantage since the men sent there were already previously exposed and trained and has experience in a similar ship which is the Gregorio del Pilar. Is there a need for more training? Let's concur with their other reasons, that the ship will be installed with a new modern radar system and new weapon gun mounts. 

Radar system. Not really. As of May 2013 MaxDefense sources said that the only radar installed were the basic short range surface search & navigation surveillance radar, possibly a Furuno FAR series similar to those installed on BRP Gregorio del Pilar. It's not something new and is a widely-used radar system in the PN, and the Gregorio del Pilar also underwent the same new radar installation, but still it never stayed in the US for more than 2 months. Even the fire control radar was also retained.

An example of the Rafael Mark 38 Mod. 2 Typhoon gun mount purchased by the Philippines

They said they are installing additional modern weapons. So far the US has released a document stating that the PN is set to receive two (2) new Mark 38 Mod. 2 remote capable 25mm chain gun systems, which are actually "re-branded" Rafael  Typhoon mounts from Israel. The document even states that these will be made mostly in Israel & completed in the US by May 2014 (that's 1 year from now!). So these guns may not be available yet for the ship.

The real reason for BRP Ramon Alcaraz's delay is because they've encountered major problems in the ship. 

1. One of its Fairbanks Morse diesel engine was spoiled and needs replacement. Taking it out means tearing parts of the hull as the engines are large. Doing this will take some time, not just weeks but months. Retired Vice Admiral Pama also admitted the engine replacement issue but made it seem a minor problem. 

2. Due to the old age of BRP Ramon Alcaraz (she was first commissioned on March 1968, or 45 years ago), it is expected that a lot of the ship's components and even the hull itself is reaching obsolescence. Ships usually have a 30 to 40 year lifespan, although refitting works can be made to extend it for a few more years. It might be the PN discovered the need to fix a lot of things inside the ship before it can ready to sail back home. Philippine laws require the purchase of used military hardware to have a minimum of 15 years of service life and in its current condition, the Ramon Alcaraz may need more dock work to meet that requirement. It is expected that she will only have minimal refitting and repainting works to navy grey before formal commissioning, as what BRP Greogorio del Pilar underwent from August to December 2011.

3. If the ships indeed get Mark 38 Mod. 2 gun mounts, there is a possibility that the US Navy will loan one or two units, and will be returned upon availability of the brand new items ordered recently. Thus the ship will indeed undergo refitting work to install them, and since this is a new item in the PN inventory the ship crew will undergo training to maintain & use them. Again, this is IF the US will temporarily loan the PN used gun mounts.

I'll be updating this posting should more evidence of delays surface, which I hope there's nothing more since the DND & PN recently announced that the ship will be in the Philippines by late June 2013. This means it needs to sail from Charleston to California via the Panama Canal by mid-May, and travel across the Pacific Ocean by late May or early June.

I wish the last public statement by the DND is the last regarding its arrival,and MaxDefense wishes the BRP Ramon Alcaraz good luck in its travel and Godspeed. Hoping for your safe arrival to serve your country.

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An In-Depth Look at the Philippine Navy Frigate Program of 2013 (1st of several parts)

The Philippine Department of National Defense (DND) released information on the purchase of new frigates after the negotiation for ex-Italian Navy Maestrale-class frigates fell through. Latest announcements place the budget for 2 brand-new ships at Php 18 billion, an increase from the almost Php 12 billion budget for 2 of the ex-Italian ships. (US$1 = Php41.19 as of 2/5/13)

ITS Maestrale (F570), lead ship of the Maestrale-class frigate
(from Wikimedia)

According to news reports, possible sources of the ships are Spain, South Korea, France, Israel, Italy, Australia, the US, Singapore, and Croatia, among others. 

Questions are raised on many Philippine defense blogs & forums: What are we getting? What's the PN requirement for the ships? Is the budget enough? Is the budget too much? 

The 2 new frigates will be the first time the Philippine Navy (PN) will be purchasing brand new major surface combatants in its history. So far all its major combat assets are ex-US Navy/Coast Guard or Royal Navy excess defense articles. This program is a big leap since it would be the first time the PN will get a ship according to their actual requirement, will be brand new and not worn-down refurbished assets, and will be the most expensive defense project for  the Philippine government. It will also upgrade the PN's asset in terms of technological features in all aspects: weapons, sensors, machinery, design, stealth, aviation capability, electrical, safety, comfort, and all others. A big boost indeed for the PN.

Let's look at the budget: Php18 billion is around US$437 million, or US$218.5 million per ship. We compare this cost with the region's other comparable shipbuilding programs:

1. Indonesia's PKR 10514 Sigma-class by Damen Schelde Shipbuilding of the Netherlands and PT PAL of Indonesia: US$220 million for 1 unit (signed June 2012);

Indonesia's PKR Program is based on Damen Schelde's Sigma 10514 design

2. South Korea's FFX-1 Incheon-class by Hyundai Heavy Industries (HHI): US$232 million for the 1st unit, although HHI contract for the hull only was W140 billion (US$106.5 million) (signed December 2008);

South Korea's Incheon-class coastal frigate will replace the older corvette and frigate classes

3. Thailand's new frigate program based on Daewoo Shipbuilding & Marine Engineering (DSME) DW-3000H: B13 billion (US$442 million) for 1 unit;

Thailand's new frigate will be based on Daewoo's DW-3000H design

4. Malaysia's SGPV LCS Gowind-class by DCNS of France and Boustead Heavy Industries of Malaysia: MYR1.5 billion (US$467 million) each (signed December 2011);

A scale model of Malaysia's upcoming SGPV-LCS based on DCNS' Gowind-class combat corvette

It may seem that our budget of US$218.5 million per ship is small even compared to its cheapest equivalent program, the Indonesian PKR 10514 Sigma-class. But is it the case? Let's take a look at what the Philippine Navy's requirements are:

1. Based on their original interest in the Maestrale class, the ship was armed with 4 x long range anti-ship cruise missiles, a 127mm gun, 2 secondary twin 40mm guns, 2 triple lightweight torpedo launchers, an 8-cell anti aircraft missile launcher for medium range AAM, a hull mounted sonar, a separate air seach and surface search radars with corresponding fire control radars, a helipad and hangar for two 5-ton helicopters or one 10-ton helicopter. It is originally designed to be an ASW platform.

2. Previous reported PN/DND announcements require for a ship with at least a 2,000-ton displacement, a length greater than 100 meters, and have anti-ship, anti-aircraft and anti-submarine capability. Very vague if you loom at it, too general.

3. We look at the current Philippine Navy weapons & sensors systems. So far at least 5 of its major warships are armed with the Oto Melara 76mm Compact naval gun. Two frigates are planned to be installed with the Mark 38 Mod.2 Typhoon mount, while three corvettes are currently installed with the MSI Defence DS25 Seahawk mounts. There are no ASM, AAM, and torpedo systems currently being operated. Radar systems are limited to short range navigation/surface surveillance types like AN/SPS-73 and Sperry Marine Bridgemaster series, or civilian-spec Furuno FAR series. No air search or 3d radars available. Sonar systems are also currently not available except for a short-range Wesmar side-scanning sonar on the ex-Cyclone inshore patrol vessel.

The Oto Melara 76mm Compact Naval Gun, being used on Gregorio del Pilar-class & Jacinto-class ships

4. A typical frigate nowadays will have at least a 3D radar for air & surface search, one or two navigational radar which can be redundant surface surveillance radars, associated fire control radar systems, an ESM & ECM system with decoy launchers, a hull-mounted or towed array sonar (or both) for anti-submarine missions, a medium caliber naval gun, secondary guns for close in ranges, an ASM system (at least 8 numbers), a AAM system (either short range for point defense or medium range for area defense), possibly a CIWS system (for shooting down incoming ASM or aircraft), and lightweight torpedoes for ASW.

The Smart-S Mk.2 3D radar
(photo from Thales Nederland website)

With these parameters, it would be safe to assume that the PN is not bounded by supply & maintenance commonality issues for now, and would only be bounded by pricing, political preference, and delivery issues. Basically the requirement is close, if not similar to most frigate programs in the region, although the technology involved might differ depending on the supplier and system integrator.

Let's analyze a possible Philippine frigate:

1. Size: 2,000-ton displacement with a length a little over 100 meters is considered a light frigate, or a heavy corvette. It appears to be smaller than the PN's Gregorio del Pilar-class. A smaller ship means compact weapons systems, a smaller power generation capacity, less crew, less space for complicated machinery, a smaller fuel tank, among others. HHI's Incheon-class, Damen Schelde's PKR Sigma 10514, and DCNS' Gowind Combat Corvette, as well as most offers all fit or surpass the dimensions indicated.

2. Machinery: currently the PN is starting to get comfortable with the CODOG (combination of diesel or gas) configuration, so it is expected that the new frigates may have the same CODOG configuration. To lessen costs, an electric drive system can replace the gas turbine, making the ship a CODOE (combination of diesel or electric) configuration, similar to Indonesia's preference. A range of around 4,000-5,000nmi at cruising speed is standard nowadays for ships of this size.

An example of a CODOG configuration. This exact diagram is used on India's Shivalik-class frigates

3. Sensors: the likelihood of using a 3D multi-beam search radar is high. Most Asian frigate/corvette programs have chosen the Thales Smart-S Mk.2 3D radar, although the EADS TRS-3D or Selex RAN-30X are other possible option. Also, this would be related to the expected upgrade program for the Gregorio del Pilar-class frigates, and whichever comes first, both ship classes may use the same radar. Use of phased-array radar like Thales' I-Mast 400/500 and Heracles, Elta EL/M-2558, CEA Technologies' CEAFAR or other similar types may not be an option due to the limited budget. Fire control radar (FCR) is required, although the quantity may vary depending on the ASM type. Possibly 2 units plus an electro-optical tracking system might be possible. 

4. Sonar: a hull mounted sonar is also expected since towed array sonar may cost more, although if only to choose one, the PN may opt for a towed array sonar and go away without the hull mounted one. Of course having both is better, but may depend on budgetary issues. Most frigate designs on offer to the PN (will be discussed separately) have both the hull mounted and towed array sonars although the final fit-out may depend on the PN's budget.

Product detail for Thales' CAPTAS Towed-array Sonar

5. Weapons: 

    5a.Guns: the PN is already using the Oto Melara 76mm Compact gun, and due to commonality the PN may opt to get the same gun, or the newer Super Rapid version with a higher rate of fire and longer range. The PN may add the Strales system with DART ammunition if funding permits, similar to those installed on the Colombian Navy's Almirante Padilla-class. The ammunition itself may not fall within the frigate's budget but in another funding program. At least 2 secondary close-in guns is possibly required, with the 25mm Mk.38 Mod.2 being the most possible due to its choice for the Gregorio del Pilar class. These can be operated manually or via a remote console in the bridge. At least two 50-caliber machine guns are also expected to be installed, which is a PN staple gun mount.

The Oto Melara 76mm Super Rapid with STRALES system

    

     5b. Anti-Ship Missiles (ASM): like the radar system this will depend on what the PN will choose to arm the Gregorio del Pilar-class frigates. The Harpoon is the most likely choice, although if costs are to be considered the cheaper MBDA MM40 Exocet Blk. III might be another possible choice. Other possible choices are the South Korean SSM-700K Haesung or the expensive but modern Kongsberg Naval Strike Missile.

The South Korean made SSM-700K Hae Sung anti-ship missile

  

     5c. Anti-Aircraft Missiles (AAM): this the most complicated weapon system in this program. Our sources indicated that the PN requirement is to have at least a 10km range, and not a MANPAD system. The best option so far is for Raytheon's medium range Evolved Sea Sparrow Missile (ESSM), which are launcher via VLS launchers. Take note the the Maestrale-class are armed with an older but almost similarly-ranged AAM in the form of Selenia's Aspide (a derivative of the old Sea Sparrow missile). Other options may include the MBDA's VL-Mica, Eurosam's Aster 15, Thales' Crotale, with South Africa's Umkhonto also reportedly being taken consideration. Since these missiles vary on their guidance systems, they are also dependent on the radar and fire control system to be chosen.

Comparison of naval-launched anti-aircraft missiles. The Mica-VL & ESSM are most probable for PN's frigate

          5d. Torpedoes: a lightweight system is very possible, with the possible choices of the American Mark 46, the Eurotorp MU90 Impact, and the Korean K745 LW Blue Shark. There are no indication if a heavyweight type is being considered by the PN.

     

     5e. Close-in Weapons System (CIWS): this is the last priority of the PN, according to our sources due to the cost issues. But being offered are the RAM system (which may double as a short range AAM), the American 20mm Phalanx and the Oerlikon Millennium 35mm. Other models are said to be offered but more information is needed at this point (we'll try to discuss later on).

The Mk. 15 Phalanx 20mm CIWS

So far there are some publicly released reports indicating some of the bidders have already forwarded their proposals. First one reported was Hyundai Heavy Industries (HHI) of South Korea, which reportedly offered the new Incheon-class frigate. Another South Korean heavyweight, Daewoo Shipbuilding & Marine Engineering (DSME) was exposed through the Facebook account of the Philippine Navy, wherein the Korean defense attache met with Philippine Navy officials together with DSME representatives. Recently Zambotimes also indicated that Spain's Navantia was offering their frigates and transport ships to the DND & PN. Further discussion about this will be made in a separate post.

Considering the items above, our future frigate looks similar to most light frigate projects in the region. The allocated budget by the Philippine government may not be enough if the PN will maximize its options, although this can be settled by reducing the installed systems upon delivery and just allocating space for future refits. More like "fitted for but not with", which is common nowadays to cash-strapped navies. Even the older Gregorio del Pilar class frigates are capable of firing Harpoon missiles, but are not fitted with due to American austerity measures in the 1990s. 

Another issue that needs to be taken into consideration is how the Philippine government will pay for these ships. It appears that the original budget for the Maestrale-class frigates worth Php 12 billion (around US$ 292 million) will be re-used, and will be added by around US$ 150 million originally allocated for the purchase of 2 refurbished ships (MaxDefense believes it could have either been the Italian Minerva-class or Artigliere-class), which might be coming from the Malampaya Special Account under General Fund 151 (or "Fund 151"). This same Fund 151 was the source of budget to buy the former USCGC Hamilton (now BRP Gregorio del Pilar)

Options can be made to maximize the budget by lowering costs of the project to fit additional or higher performance systems. Options include:

1. Local production of the hull, with the complicated systems imported and installed locally. Some of the bidders actually have local counterparts that may make use of the lower production costs at the same time give our counterparts experience in such work. Negative side might be a longer timeframe  due to less experience by local counterparts. Example is Austal of Australia, they may opt to build the ships in their new Cebu shipyard.

2. Offsetting the costs by counter-trade. This has been done before, with the PAF's Aermacchi S-211 being the most publicized example (I believe you've heard of the ladies underwear stories). Our government will be able to save as well as help local producers and exporters in this manner. 

3. Offsetting by counter-investment. Entities involved may opt to invest in the Philippines, either manufacturing or servicing units, thus returning the costs back to the country in the form of the Foreign Direct Investment (FDI), which the current Aquino administration wanted to increase.

MaxDefense' projected Philippine Navy light frigate may look like this:

- CODOG propulsion using one Rolls-Royce MT30 gas turbine & 2 diesel engines

- crew of 120-140 plus air component crew, endurance of at least 20 days

- operating range of 5,000nmi at cruising speed

- maximum speed of 29 knots using gas turbine

- Thales Smart-S Mk.2 3D radar with IFF

- 2 x navigational/surface surveillance radars

- 2 x fire control radars

- 1 x electro-optical tracking system

- ESM & ECM systems

- fitted with but not with towed-array sonar

- hull mounted sonar

- 1 x Oto Melara 76mm Super Rapid Gun, fitted but not with Strales system

- 2 x Mk. 38 Mod. 2 25mm chain gun system

- 2 x M2HB 50-cal machine guns

- 2 x quad Boeing Harpoon Blk. II SSM

- 1 x 8-cell Sylver A35 VLS for VL-Mica IR SAM

- no CIWS 

- 2 x triple Mk.32 torpedo launchers for Mk.46 Mod.5 torpedoes

- 1 x Super Lynx 300 ASW helicopter (for separate discussion)
- 2 x RHIB

Further discussions regarding the possible offers and other options on the next posts.

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