Eastern Shipbuilding Group (ESG), Panama City, Fla., has entered into an agreement with HII’s Ingalls Shipbuilding division to produce outfitted structural units for the U.S. Navy’s Flight III Arleigh Burke-class (DDG 51) destroyers.

The agreement follows a pilot program at ESG’s Nelson Street Facility in Panama City, where the yard successfully built a limited number of DDG units, ESG said. Expanding that work, ESG said it will now contribute additional capacity to the Navy’s surface combatant program, helping strengthen the domestic industrial base.

“With nearly fifty years of experience delivering reliable steel and aluminum vessels, we’re proud to partner with HII to support production of the U.S. Navy’s destroyer fleet,” said Joey D’Isernia, CEO of Eastern Shipbuilding Group. “This collaboration strengthens our national shipbuilding capability—expanding industrial capacity and enhancing our nation’s competitive advantage.”

ESG said it is investing in its Panama City facility to support the Navy work, with a major infrastructure upgrade scheduled for completion this summer. The shipyard expects the expansion to boost ESG’s ability to construct and deliver multiple ships annually.