The Navy awarded a $5.1 billion contract to General Dynamics (GD) - Get Report subsidiary General Dynamics Electric Boat for completion of a new fleet of ballistic missile submarines, which are "the most important acquisition program the Navy has today," Navy Secretary Richard V. Spencer said in a statement.

General Dynamics won the rights for design, completion, component and technology development and prototyping efforts for the 12-ship Columbia Class fleet of ballistic missile submarines designed to ensure second-strike capability and spearhead strategic deterrence efforts.

The Navy's submarines are responsible for half of the Department of Defense's nuclear warheads through the government's "#1 mission" - strategic deterrence, according to the Navy's submarine history.

The new Columbia Class will replace the existing 14-ship fleet of Ohio Class nuclear ballistic submarines. Columbia Class construction will start in 2021 with first patrol in 2031, the Navy said. The fleet will provide the U.S. with "a credible and survivable sea-based strategic deterrent."

The contract includes further work with the U.K., which will offer "unique efforts" for the submarines' common missile compartment.

The announcement of this next step in the future of nuclear strategic deterrence at sea comes as North Korea reportedly threatened to test a hydrogen bomb in the Pacific Ocean.

General Dynamics stock traded up 0.1% to $205.91 midday Friday.

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