Nova Scotia wins CAD $25 billion contract

[JudgeKing]

Halifax's Irving Shipbuilding is getting the $25 billion contract to build 21 Canadian combat ships and Vancouver's Seaspan Marine has been awarded an $8 billion contract for 7 non-combat vessels, the federal government said Wednesday.

The $33 billion in shipbuilding work will bring 15,000 jobs to the country, Defence Minister Peter Mackay said earlier Wednesday.

"At the end of the day, this is going to be an investment that is going to create upwards of 15,000 jobs right across the country," MacKay said Wednesday morning, hours before the announcement was due.

"Keep in mind this is about rebuilding our navy, our coast guard, the vessels that we will need well into the future. It's going to be a huge injection into the economy. And it's going to be done in a way that is de-politicized and fair, and inclusive, for all regions."

The winning bids announced in Ottawa by Francois Guimont, the top civil servant from Public Works and Government Services, the department in charge of procurement, are for frigates, supply ships, patrol boats and icebreakers that will cover Canada's naval and coast guard needs for the next three decades.

Rona Ambrose, public works and government services minister, will make a statement on the decision at 5 p.m. ET.

Three shipyards entered bids: Irving Shipbuilding in Halifax, Seaspan Marine in Vancouver and the Davie Shipyard in Lévis, Que. The competition among the three regions meant the file was bound to be politically tricky to navigate.

MacKay says it’s the most fair contract award process ever in Canada.

"There’s never been a more fair process, more inclusive, more transparent. Lots of oversight, fairness monitors," he said. "This will be decided on merit."

A shipyard was not allowed to win both projects. The shipyard walking away empty-handed Wednesday will still be eligible to bid on further contracts worth $2 billion in total to build smaller ships. The two successful shipyards will not be eligible to bid on that work.

The bidders and federal ministers were notified of the outcome only minutes in advance of the announcement. The three companies were all readying press conferences at their shipyards to respond when the announcement comes after the close of the main North American stock markets.

CBC's live coverage
CBC has live coverage of the shipbuilding contracts announcement at 4 p.m. ET at CBCnews.ca and on CBC News Network, followed by reaction from Ottawa and across the country.

For more analysis and reaction, watch CBC's Power & Politics at 5 p.m. ET on CBC News Network.
Nova Scotia Premier Darrell Dexter, who was supposed to be out of the country Wednesday, is now expected to be in Halifax instead.

B.C. Premier Christy Clark will take media questions around 5:30 p.m. ET in Victoria, then make a statement in the legislature and fly to Vancouver for Seaspan's press conference.

Liberal Interim Leader Bob Rae said Wednesday the government is going to have to look at economic development and other assistance for the losing city. He says it’s not just companies that win the contracts, but regions.

The Halifax Shipyard, owned by Irving Shipbuilding, has been awarded the most lucrative of the federal shipbuilding contracts announced Wednesday. Vancouver's Seaspan Marine is the other winning bidder. Andrew Vaughan/Canadian Press "And there are lots of things that can happen afterward, in terms of sub-contracts. The reality of building a ship is that much of the insides, the electronic systems, all the other aspects of it, are not confined to one region or another," Rae said.

"We need to understand what the impacts are and then we need to understand the impact on a particular centre … It's very important for us to look down the road at making sure that we have a plan in place and this is a government responsibility for the yard that is not successful."

Nova Scotia NDP MP Peter Stoffer will react to the news at 4:30 p.m. ET.

After the announcement today, the shipyards will finalize their agreements with the government and negotiate contracts in 2012 for the first project in each package of work.

Link here.

Congrats to Nova Scotia for winning the contract to build the Canadian Single Class Surface Combatant, Joint Support Ship, and other designs.

[Enigma]

I don't think that it is much of a surprise. As far as I know the Irving Shipbuilding is one of the only if not the only shipbuilder that can handle such project. This is going be a decade old memory so I may be wrong.

Plus I remember hearing that the Irving family had ties with the federal government but that was during either the Chretien years or Mulroney.

[Phantasee]

Every commenter has mentioned that it was done very well, a model case of awarding a bid without political entanglements. It's unfortunate that the Davie yard won't get the big work, but they'll get some smaller bids (the $2 billion mentioned, plus a piece of some future work). When it came down to it, Irving was best suited for the work.

A country like Canada can't really support three yards in peace time, one on each coast is pretty much the limit. At least this 30-year plan for shipbuilding will help us retain a shipbuilding industry and capability for the future.

[Coop D'etat]

I have to give props to the government on this one. Usually this kind of thing has devolved into a regionalist clusterfuck. They did the smart thing by putting it out of the hands of anyone that has to get elected.