The government may announce that it is improving the terms of that deal to reflect increased costs.
The agreement is to be presented as early fruits of the government’s post Brexit “reset”.
Navantia, which is 100% owned by Spain’s government, has been a significant recipient of funding from the European Commission as part of the European Defence Fund.
Joining the fund is a possible objective for the UK-EU security reset, set to be discussed at a summit early in the new year.
The Spanish economy minister responsible for its state-owned businesses, Carlos Cuerpo, met with Chancellor Rachel Reeves and Business Secretary Jonathan Reynolds in London last month.
Navantia already has a business relationship with Harland and Wolff. It is the main contractor on a project to build three support ships for the Royal Navy, with Harland and Wolff acting as UK subcontractor.
The company employs a core staff of about 1,200 in Belfast, Appledore in England and Methil and Arnish in Scotland.
Navantia’s main shipyard is at Cadiz in southern Spain.
It employs more than 4,000 people and has an annual turnover of about €1.3bn (£835m).
