OTTAWA -- Canada's most-expensive military project is about to enter a new phase as the government is on the verge of picking its preferred design for the country's $60-billion fleet of new warships.

Defence insiders say the government wants to decide on the favoured design by the end of the month from among options submitted by three companies vying for the lucrative work.

After that the government will sit down with the winning bidder to hammer out the final cost and other details.

Halifax-based Irving Shipbuilding, which the government has already picked to actually build 15 warships over the next two decades, will be involved in those talks.

The stakes will be intense for both sides, with hundreds of millions of dollars in play and pressure to move forward on a project that is already running behind schedule.

The design competition is the most recent -- and arguably most sensitive -- phase in the entire plan to build new warships for the navy, which will replace Canada's existing Halifax-class frigates.