Eight P-8A Poseidon aircraft are planned to replace the AP-3C Orion by 2017-18 (the Orion will reach its ‘life of type’ around 2019, by when it will have been in service with the Air Force for over 50 years).

Phase 2B - Maritime Patrol Aircraft - is intended to provide the manned component of the ADF maritime patrol capability that will replace the AP-3C Orion aircraft.

Australia has committed to buy eight Boeing P-8A maritime patrol aircraft as part of an investment of $A5 billion. These aircraft will maintain the capability currently provided by the AP-3C Orion aircraft, when that aircraft is retired in 2018 after 30 years of RAAF service.

Until then, the Australian Defence will cooperate with the U.S. Navy to develop upgrades to the P-8A Poseidon aircraft, which has recently entered the early flight testing. The P-8A is being developed for the U.S. Navy. A special version and recently been acquired by India. To fit Australian specific requirements into the development process, the collaboration will focus on 'Spiral One' update of the aircraft. This phase represents the first batch of improvements planned through the life of the aircraft. The cooperation will also gain Australia access and influence into the P-8A improvements and support program. Australia is already cooperating with the U.S. on the AEW version of the Boeing 737 which also provides the platform for the P-8A.

Defence Minister Stephen Smith and Minister for Defence Materiel Jason Clare have signed a new agreement with the United States Navy to participate in the third P-8A development stage, contributing $73.9 million towards the project.

That formalises Australia's ongoing participation in the US$5 billion project.

Mr Smith said Orions had served Australia but they would eventually be replaced.

"We will ultimately replace our Orion P-3s with the the P-8. That is a long-term project," he told reporters at RAAF Amberley in Queensland.

"The Orions are expected to remain in service until the end of this decade or the start of the 2020s. But we have committed ourselves to further work on the P-8 project in collaboration with our United States colleagues."

The RAAF currently operates 19 Lockheed AP-3C Orions which entered service in the mid-1980s.

They have been progressively upgraded with advanced radar and camera systems and can perform maritime and overland surveillance, search and rescue missions and also hunt for submarines.

Orions have played an important role in border protection operations and two operated in the Middle East from 2003, conducting missions over the Persian Gulf region as well as over Afghanistan.

In 2007, the government gave initial approval to acquire the Poseidon, an aircraft based on the widely-used Boeing 737 airliner and which is set to replace Orions in US Navy service. Australia initially contributed $150 million to join the P-8A program, subsequently adding a further $100 million.

Mr Smith said the Orions had long been based at RAAF Edinburgh in South Australia and it was anticipated the Poseidons would also be based in South Australia.

"Whilst we have made no formal decision - it's a decision that we don't need to make for some considerable time - there's an expectation that the P-8s will probably end up in Edinburgh," he said.