Quebec's Chantier Davie only shipyard to qualify for icebreaker work: Feds

An overall view of the Davie shipyard is sshown on Friday, December 14, 2018 in Levis Quebec.THE CANADIAN PRESS/Jacques Boissinot

OTTAWA — The Quebec shipbuilding industry got a boost from the federal Liberal government Thursday, with news that the Davie shipyard outside Quebec City will be the only builder eligible for potentially billions of dollars of work building Canada's next fleet of icebreakers.

Ontario-based Heddle Shipyards, which had raised concerns from the start that the selection process was rigged in Davie's favour, did not qualify, according to Public Services and Procurement Canada. It was the only other company to apply.

News of Davie's qualification followed the Liberals' decision earlier this year to add a third shipyard to the federal government's multibillion-dollar shipbuilding program, through which the government is building new naval warships, Arctic patrol vessels and coast guard science ships.

The third yard will join Irving Shipbuilding in Halifax and Seaspan Marine in Vancouver in the shipbuilding program. It will be responsible for constructing at least six new icebreakers for the Canadian Coast Guard.

Davie will now be required to submit a formal bid to become the third shipyard, which will include an assessment to ensure it has the money and infrastructure necessary to build the icebreakers. A formal agreement between the government and Davie is expected in late 2020.

Federal procurement minister Anita Anand described Davie's qualification as "a critical milestone" in meeting Canada's shipbuilding needs, while the Quebec company was practically crowing at what amounted to the culmination of years of intense lobbying in Ottawa and Quebec City.

Davie and its allies in the Quebec provincial government had been pressing Ottawa for years to be added to the shipbuilding strategy. While the company had scored a number of federal contracts without competition in recent years, Thursday's announcement is worth much more.

"Today's historic announcement marks the beginning of a multi-generational program which will span the next three decades and sustain Davie's position as a global leader in the delivery of specialist, mission-critical ships," Davie chairman Alex Vicefield said in a statement.

"We thank the prime minister and his government for delivering on their commitment to refresh the shipbuilding strategy and confirming Davie as a key strategic partner."

Meanwhile, Shaun Padulo, the president of Heddle Shipyards, was expressing disappointment and frustration Thursday that the government had determined his company did not meet its requirements as the third yard.

Heddle Shipyards, previously known as Heddle Marine Service, is based in Hamilton and owns the Thunder Bay shipyards and Port Weller dry docks.

It had sought to leverage a partnership with Dutch conglomerate Damen Shipbuilding to qualify, but Padulo said the government refused to count Damen's experience in Heddle's bid.

"We're disappointed with the government's decision and we're reviewing all of our options with respect to the third-shipyard initiative," Padulo told The Canadian Press.

"We have the facilities and the capacity required to support the government of Canada and so we'll continue to explore options for how we can provide solutions to the government on this initiative and others related to the national shipbuilding strategy."

Soon after the federal government launched its search for a third shipyard in August, which most observers believed would lead to Davie's selection, Heddle filed a complaint to the Canadian International Trade Tribunal alleging the process was biased in favour of the Quebec yard.

The federal procurement department subsequently amended some of the requirements, but Heddle asked the tribunal, which is responsible for ensuring the government follows proper procurement rules to press ahead with its probe.

It was at that point that the government invoked a controversial national-security exception that prevents such investigations.

This report by The Canadian Press was first published Dec. 19, 2019.