Create a rule called “Fleets”

Battleships are Vessels; Battleships are Armed with Shells; Battleships have a Range of 5 squares; Battleships have an Armour Value of 6.
Submarines are Vessels; Submarines are Armed with Torpedoes; Submarines have a Range of 10 squares. Submarines have an Armour Value of 3.

Create a rule called “Navigation”

Captains can move Vessels they control.

Vessels have a Facing; a Vessel’s Facing is either North (N), East (E), South (S) or West (W).
A Vessel’s Facing is defined by the direction it last moved in. If the last square it moved into was North (N) of the previous square, its Facing is North (N); if the last square it moved into was East (E) of the previous square, its Facing is East (E); if the last square it moved into was South (S) of the previous square, its Facing is South (S); if the last square it moved into was West (W) of the previous square, its Facing is West (W).

Once per Watch, a Battleship can move up to 3 squares in the direction it is facing, or up to 2 squares perpendicular to the direction it is facing, or up to 1 squares in the opposite direction to the direction it is facing.

Alternatively, once per Watch, a Battleship may move 1 square in the direction it is facing, then move one square perpendicular to the way it is facing.

Once per Watch, a Submarine can Move up to 3 adjacent squares in any combination of directions.

Create a rule called “Fire Control”

Vessels which are Armed can Shoot; Armed Vessels can Shoot a distance, measured in squares, from a square adjacent to the square they are located in. 

Once per Watch, a Battleship can Shoot at up to 2 squares.
A Battleship cannot Shoot at a square adjacent to the square it is located in; a Battleship can choose to shoot at the same square twice.

Once per Watch, a Submarine can Shoot at up to 1 square; this square must be between the Submarine and the grid edge the Submarine is Facing.