Discovery Air and Airbus Military announced Wednesday they're teaming up to bid on a 20-year contract to provide and maintain Canada's fixed-wing search and rescue fleet.

Airbus Military manufactures military and civic transport aircraft.

The two companies hope the contract would include setting up a search and rescue base in the North.

Currently, all military airplanes used in northern searches are dispatched out of CFB Trenton in eastern Ontario, or Winnipeg.

"From Discovery Air's point of view, we think that's wrong," said Brian Semkowski, CEO of Discovery Air. "They should be closer to the North. If you want to search and rescue somebody, they should be closer to where the action is happening."

Under the memorandum of understanding the companies have signed, Airbus will provide its C295 aircraft and Discovery Air will provide training, engineering and maintenance.

N.W.T. Premier Bob McLeod gave his blessing to the partnership at a gathering Wednesday morning at Discovery's Air Tindi hangar in Yellowknife.

"The Northwest Territories is many hours from the nearest dedicated search and rescue facility," said McLeod.

"Whenever I say that to people, they are surprised. They know how harsh our climate is. In any search and rescue operation, every minute counts. This is particularly true in our northern winters. Northerners are Canadians, too. We should not be penalized for where we live."

The federal government decides where the bases will be located. That could take a year as it works out the requirements of the contract.

"If I am not wrong, about five contenders are approaching the government and the list will be reduced quite a bit in the next future," said Antonio Rodrigues-Barberan, senior vice-president of Airbus Military.

The federal government wants to replace the 19 fixed-wing planes in its aging search and rescue fleet.

They say the request for proposals won't be issued for another year or so.