The Prime Minister says the Australian Submarine Corporation will have a shot at a $20 billion dollar submarine-building contract, but there are fears it may just be a rouse.

Tony Abbott told South Australian federal MPs over the weekend that the government-owned submarine shop would be able to make a bid in “a competitive evaluation process” for the contract.

But some close to the issue say that is not a term they have heard before.

While the Government talks in hints and whispers about the submarine deal, thousands of jobs and a multi-billion dollar economic boost hangs in the balance.

The following day, Finance Minister Mathias Cormann repeated the PM's claim that “a competitive evaluation process” would decide who builds Australia’s next generation of submarines.

“The Government will be determining the process and how it works,” Senator Cormann said.

“I mean at the moment no decision has actually been made in relation to the procurement of the next generation of submarines.”

But Dr Andrew Davies – a senior analyst with the Australian Strategic Policy Institute - says “competitive evaluation process” is not a formal defence term.

“It's not a formal part of the nomenclature in defence, no," he told reporters.

“Before the comment made in the press yesterday about the submarine strategy we didn't really know how defence was going to go about acquiring the new submarine and I'd suggest that we still don't,” he said.

After Mr Abbott's visit to Japan last year, media reports indicated that Australia was moving towards a sole-source deal with Japan.

Japan’s 4200 tonne Soryu-class submarine are the right size for Australian needs, but would require complete modification to meet the required range and endurance.

Independent South Australian senator Nick Xenophon says the likelihood of the deal going to an Australian company seems lower as the issue drags on.

“Prior to the last election, the Government committed to having the subs built in Australia,” Xenophon said.

“After the election, the Government said it would be making a decision within 18 months on the subs, to ensure there wasn't any capability gap.

“We now find that the Prime Minister, despite those statements time and time again in the last 12 months, is now talking about a decision being made at the end of this year.

“That's stretching it out an additional eight months, despite the urgency that Joe Hockey as Treasurer professed on this issue just a few months ago.”

Defence Minister Kevin Andrews has used the term “competitive evaluation process” in a press conference this morning.