SYDNEY (Reuters) -Australia said it will spend A$1.7 billion ($1.1 billion) on a fleet of "Ghost Shark" autonomous undersea vehicles, developed by its defence force and U.S. startup Anduril Industries, for surveillance and strikes.

Defence Minister Richard Marles told reporters on Wednesday the Ghost Shark will complement Australia's navy surface fleet and submarines to provide "a more capable and more lethal navy".

Dozens of Ghost Sharks will be built in Australia, with opportunities to export to allies, Defence Industry Minister Pat Conroy said.

"It has the capability to conduct intelligence, surveillance and reconnaissance and strike at extremely long distances from the Australian continent," Conroy said, adding that the first Ghost Sharks will be in service at the beginning of 2026.

The contract with Anduril Australia covers the delivery, maintenance and continued development of the Ghost Shark over the next five years, officials said.

Anduril has been readying a facility in New South Wales for production ahead of any contract. It began working with Australia's defence force on the development of the Ghost Shark in 2022.

Australia's Defence Science and Technology Group has said it wants to incorporate autonomous technology into the defence force because Australia has a vast coastline and up to 3 million square kilometres (1.2 million square miles) of northern ocean that needs to be defended, but only a relatively sparse population.

It separately plans to build nuclear-powered submarines with Britain and the United States under the AUKUS programme over three decades.

($1 = 1.5168 Australian dollars)