Henderson is set to become home to the largest naval maintenance hub in the Southern Hemisphere.
On Wednesday, Defence Minister and Deputy Prime Minister Richard Marles and Premier Roger Cook announced the new deal which would see the defence precinct maintain future nuclear-powered submarines at the expanded shipyard.
The hub would also build new landing craft for the Australian Army and new frigates for the Navy.
About 6300 jobs are set to be created during construction, submarine maintenance and ship building, while 3500 roles will be opened up at HMAS Stirling to facilitate the Submarine Rotational Force-West operation.
The Federal Government has committed $127 million for planning, designing and enabling works with a further commitment of funding set to be in the tens of billions of dollars over the next two decades.

Deputy Prime Minister Richard Marles said the defence hub is a critical next step in delivering continuous naval shipbuilding in Western Australia.
“The Albanese Government’s commitments represent the most consequential defence investment in Western Australia in nearly four decades, since the commissioning of HMAS Stirling in 1978 and its expanded role as Australia’s Indian Ocean fleet base under the 1987 two-oceans navy policy," Mr Marles said.
“The Defence Precinct at Henderson will optimise Australia’s shipbuilding and sustainment industry while supporting continuous naval shipbuilding in Western Australia and Australia’s nuclear-powered submarine pathway."
Premier Roger Cook said the precinct will set up WA for an exciting future.
“The new Defence Precinct at Henderson will deliver tens of billions of dollars in investment and thousands of local jobs," Mr Cook said.
“This massive investment delivers on my Government’s mission to develop and diversify our State’s economy by providing another economic pathway for our State for decades to follow.
“It is a win-win for Western Australia and the nation.”
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