The Australian government will spend at least 10 billion Australian dollars (US$7.4 billion) on building a new base to house a future fleet of nuclear submarines, as Prime Minister Scott Morrison warns the Ukraine war will "inevitably stretch” to the Indo-Pacific.

Morrison will announce the project, the first construction of a major new base in Australia since the 1990s, in a foreign policy speech in Sydney on Monday. The Defence Department has selected three possible east coast locations for the submarine facility — Newcastle and Port Kembla in the state of New South Wales and the Queensland capital of Brisbane.

In his speech to the Lowy Institute, Morrison will warn against rising militarization and attacks on liberal democracies in the Asia Pacific region, saying "Australia faces its most difficult and dangerous security environment in 80 years.”