Halifax wins $25 billion shipbuilding contract
Published Wednesday, October 19, 2011 11:00PM EDT
Nova Scotia's Halifax Shipyard has landed a $25-billion contract to build new combat ships for the Canadian navy over the next 20 years, the federal government announced in Ottawa on Wednesday.
Irving Shipbuilding will be the main company responsible for building the navy's new warships.
An $8-billion contract for seven non-combat vessels went to Vancouver's Seaspan Marine Corp. The Davie shipyard of Levis, Que., was the third contender for the contracts and was left on the outside.
The contract will be a windfall for Nova Scotia's struggling economy and Irving, the owner of the shipyard, has said the winning contract will create about 11,500 in direct and indirect jobs for the region.
Nova Scotia Premier Darrell Dexter had compared the $25 billion contract to winning the Olympics every year for the next 30 years.
"What an amazing, historic day for NS," Dexter tweeted after the announcement.
He said the contract will help the province turn the corner after 20 years of slow economic growth.
"I think there will be an awful lot of happy people around this province tonight," he told CTV's Power Play.
Jim Irving, CEO of Irving Shipbuilding, said: "To every Nova Scotian and Canadian who put up a lawn sign, put a pin on the electronic map or sent us words of encouragement, we can't thank you enough."
Francois Guimont, deputy minister of the Public Works Department made the announcement as the Conservative government went to great lengths to avoid appearances of political interference throughout the procurement process.
Another $2 billion in smaller shipbuilding contracts will be announced later.
Rear Admiral Mark Norman, the deputy commander of the Royal Canadian Navy, said the contracts start the biggest rebuilding period for the Canadian navy since the Second World War.
"It's a great day for Canada and the Royal Canadian Navy," he told CTV's Power Play.
Norman said the first vessels could be christened as soon as 2015.
Halifax Shipyard has been in operation since 1889 and Irving Shipbuilding is responsible for about 80 per cent of the Canadian navy's surface fleet.
Nova Scotia NDP MP Peter Stoffer said he had to give credit where credit was due and congratulated the federal government for its independence in the procurement process.
"I have to say how proud I am and have to give the government credit for the independence of this program," he said at the press conference in Ottawa. "I have no evidence leading up to know that any political interference in any way, shape or form led to this."
While they lost out on the biggest contract, lawmakers in British Columbia were excited to take the $8-billion contract.
"You know what? Despite the fact that I was absolutely confident throughout the process, you're still on the edge of your seat," Premier Christy Clark said.
"It was like the Olympics there, don't you think? Trying to wait for them to get through all the stuff that had to happen before they finally made the announcement ... You know what this tells us. It tells us that Canada works, so B.C. can get to work."
Public Works Minister Rona Ambrose said the bidders had to show they would create jobs around the country.
"The benefits of this strategy to the Canadian economy are truly staggering," she said. "This will result in high-quality jobs for decades to come."
It is hoped the plan will be a boon for the struggling shipbuilding sector which has gone up and down over the years based on the availability of government contracts.
"This innovative strategy brings predictability to shipbuilding procurement and eliminates boom and bust, providing benefits to the entire marine industry," Ambrose said after the announcement. "This is truly a win for Canada because we are reinvigorating our shipbuilding industry and making it internationally competitive like never before."
The Canadian Manufacturers & Exporters group said the contracts will benefit the entire Canadian economy.
"Beyond the benefits for the winning companies and their workers, the shipbuilding contracts will have profound benefits for the entire economy, coast-to-coast," CME president Jayson Myers said in a statement.
"We congratulate the government on a fair and transparent process that will maximize opportunity for participation and growth throughout all regions of Canada to address the subject matter."