So, Australia's just agreed to pay British company BAE Systems $35 billion to build nine high-tech, anti-submarine frigates.

The contract is a key building block in the Federal Government's defence industry plan, which Malcolm Turnbull says will form a "truly sovereign national Australian shipbuilding industry" ensuring the country's security and prosperity.

Here's what you need to know about the new Hunter class Type 26 global combat ships we're dropping billions of dollars on.

What is a frigate?

Traditionally, frigates have been smaller and more manoeuvrable than larger classes of surface combatants, and in the past few decades have been optimised for anti-submarine warfare.

The Type 26's predecessor, the Type 23, is generally regarded as being the best anti-submarine frigate in the world.

Traditionally, vessel classes went (from smallest to largest): Sloop, Corvette, Frigate, Destroyer, Cruiser, Battlecruiser, Battleship.

But these days there is much variation in where different ships fall within those classes.

What kind of frigate is Australia getting?

BAE Systems offered up a fleet of brand new warships (new as in, these warships haven't even been built anywhere else, yet) to beat out designs from Spanish and Italian shipbuilders to secure the contract.

The Type 26 global combat ships boast two electric motors and a gas turbine that can power the 8,800-tonne, 150-metre-long frigate along at a top speed of over 27 knots.

Here's what it looks like (kind of):

An annotated, computer-generated image of the Hunter class Type 26 global combat ship, by BAE Systems. ( Supplied: Prime Minister's Office )

Its weaponry includes torpedos, missiles, a vertical launch system and some fairly high-tech radar and sonar sensors.

It also comes with one MH60 Romeo helicopter and a mission bay for an unmanned system or additional helicopter.

It can accommodate up to 180 crew.

What can these frigates actually do?

The Type 26 certainly moves away from the "smaller" way of thinking, and with the advent of combat systems that can complete anti-submarine and anti-air missions (such as the system the Australian fleet will use, Aegis), the vessel class categories are today pretty much meaningless.

For anti-sub work, a ship needs to be very quiet. The engine is insulated from the hull to reduce noise and vibration.

They can move slowly on battery power only, and they have a high-end sonar suite built in to the hull plus a towed sonar array as well.

So with the Romeo helicopter, it has three ways to detect and track a sub.

The anti-ship missiles and advanced combat management system on board means they're fully capable for other missions, too.

Defence Minister Marise Payne thinks they're the best:

"[These have] the best capability to equip the Navy in anti-submarine warfare, with range and endurance, [they are] able to operate independently or as part of a task group, and to contribute as well in humanitarian assistance and disaster relief."

Why do we need them?

According to Australia's most recent Defence White Paper, China's Navy is now the largest in Asia and by 2020 its submarine force is likely to grow to more than 70 submarines.

The White Paper also predicts that "within the broader Indo-Pacific region, in the next two decades, half of the world's submarines will be operating in the region".

"Within the same period, at least half of the world's advanced combat aircraft, armed with extended range missiles and supported by highly sophisticated information networks, will be operated by Indo-Pacific countries."

When and where will they be built?

ASC Shipbuilding, which is owned by the Australian Government, will become a subsidiary of BAE during the build.

Its shipyard in the Adelaide suburb of Osborne will be the hub once production starts in 2020.

The frigate contract is expected to create 4,000 Australian jobs including 2,500 across Australia throughout the supply chain. ( Supplied: Prime Minister's Office )

The Hunter class frigates are expected to enter service in the late 2020s and will eventually replace the current Anzac class frigates, which have been in service since 1996.

However, the UK Royal Navy is also buying the Type 26, the first two of which are currently under construction. That fleet is not expected to be operational until 2027, which has some questioning whether the Australian frigates will be delayed.

At the end of the building program Australia will resume complete ownership of ASC Shipbuilding, meaning intellectual property of the Australian type 26 will be retained by the Commonwealth.