N.W.T. to spend another $7M to $10M on Deh Cho Bridge
But bridge still set to open on schedule in November
The N.W.T.'s Minister of Transportation announced Wednesday the government will spend an extra $7 million to $10 million to finish the Deh Cho Bridge on time.
In the legislature, David Ramsay said he's pleased with the quality of work that has been done by Ruskin Construction. However, he said that an independent engineering assessment says they still need more resources to get the bridge open by the fall.
"The department and Ruskin Construction have recently come to an Agreement in Principle that will help us meet this shared goal … The agreement also sets out how additional costs would be shared by the two parties, with the GNWT share capped at just under $10 million," said Ramsay.
Extra cash meant to save money in long run
Ramsay said the department had few options as work was falling behind schedule.
They could have put off opening the bridge until 2013, but they would have had to pay for extra time spent dealing with claims from the contractor in court. Another option would have been to force the contractor to pay for the extra costs to finish the bridge on time, and ending up in a legal battle to find out whose fault it was.
The department decided to instead work with the company and come to an agreement.
The extra $7 to $10 million is supposed to cover any claims so that there are no additional legal disputes about added costs. Ramsay said paying the money now will save the territory $5 million to $7 million.
If the contractor can't keep up its end of the bargain and finish the bridge on time with the extra money, the department can get out of the agreement. However, that would mean it would be up to the courts to decide who should pay for those extra costs.
The total cost of the bridge is now at $202 million.
Cost overruns, delays have plagued construction
The Deh Cho Bridge project, when complete, will provide a year-round link over the Mackenzie River to the south for much of the N.W.T. Currently there is ferry access in the summer and an ice road in the winter.
The government claims the bridge will cut costs of shipping goods and fuel North, but questions remain as to whether that will happen.
The project has been in the works for about a decade. It has been plagued by construction delays and cost overruns.
Former Auditor-General Sheila Fraser audited the construction of the bridge last year. She said she would be "surprised" if the bridge's costs would not exceed $182 million. In her report, Fraser said the territorial government did not adequately manage the risks of the project.