Bidders want shipbuilding deadline extension

Two of the four bidders for an estimated $35 billion in contracts want more time from the federal government to prepare their proposals.

Two eligible bidders want July deadline moved to September, but no decision yet

Nova Scotia Premier Darrell Dexter, right, arrives for a meeting with Prime Minister Stephen Harper in Ottawa on June 20. (Sean Kilpatrick/Canadian Press)

The largest government procurement process in Canadian history may get a little longer if some of the competitors get their way.

Two eligible bidders for an estimated $35-billion in shipbuilding contracts for Canada's navy and Coast Guard have requested an extension of the July 7 deadline for proposals.

Four companies are in the running for the contracts. The two-leading candidates, Halifax-based Irving and Seaspan Marine Inc., a bidder from British Columbia, are opposed to extending the deadline, The Canadian Press reported Friday.

In a statement Friday, the government said it has not yet decided whether to extend the deadline as requested to September 12, and will not comment further until a decision is made. The statement noted that these kinds of requests are not unusual in this type of procurement process.

One winner will be awarded the $25-billion combat vessel construction deal. Another bidder will be chosen to build the non-combat ships, which account for the remaining $8 billion of contracts initially. That order could grow to include more Coast Guard replacements.

Both deals would result in about the same investment for a winning shipyard over the short term.

By the end of the process, expected to take up to two years, contracts for the building and ongoing maintenance of more than 30 new ships be awarded.

Both coasts vying for contracts

British Columbia Premier Christy Clark was recognized in the House of Commons gallery during her visit June 23. (Sean Kilpatrick/Canadian Press)

Earlier this month, Public Works Minister Rona Ambrose announced with some fanfare that lobbyists were not welcome to interfere in the government's decision for the vessels.

But provincial premiers haven't hesitated to insert themselves into the fray. Nova Scotia Premier Darrell Dexter has made two publicized trips to Ottawa to lobby for the only Canadian-owned bid, Halifax Shipyards, owned by the Saint John, N.B.-based Irving interests.

"Something like 90 per cent of the fleet that's currently at sea is from the Irving shipyards, and we are Canada's shipbuilders," Dexter said Monday to host Evan Solomon on CBC News Network's Power & Politics.

Dexter's pitch for the military embracing Irving's bid includes economic spinoffs and jobs not just in Nova Scotia but also from coast to coast as a result of a national supply chain.

British Columbia Premier Christy Clark also went to Ottawa this week; she spent Thursday trying to twist arms in support of Vancouver-based Seaspan's bid.

"If there's going to be two shipbuilding contracts, one of them should be to Canada's west coast," Clark said in another interview with Solomon on Thursday.

"We have been building ships for a century," Clark noted, touting the skilled workforce available in British Columbia.

Both Dexter and Clark opposed an extension of the bid deadline on Friday.

"A further extension at this time would create the impression that the process is being adjusted to favour some bids over others," wrote Dexter in a letter to Public Works.

Clark also issued a statement Friday.

"All the companies have known the deadline and changing the rules now would send the wrong message," Clark said in the statement, according to The Canadian Press.

The federal government is expected to take regional considerations seriously in awarding the contracts, which could mean thousands of jobs and millions in economic spinoffs.

"We can do either [contract]. We'll have to see how it all gets split up in the end," Clark told Solomon.

An extension to the proposal stage would be helpful to Quebec's bid, the near-bankrupt MIL-Davie Yards Inc. in Lévis, Que.

An Italian consortium is restructuring the now-idle facility, and Quebec's Superior Court has extended a stay on the bankruptcy proceedings to the current bidding deadline of July 7.

Public Works Minister Ambrose has confirmed that if Davie cannot prove it's financially sound, it won't be considered for government shipbuilding contracts.

A fourth competitor, Seaway Marine and Industrial Inc., is based in St. Catharines, Ont. The facility cannot handle ocean-going vessells but it has won Coast Guard business in the past.

Losing shipyards from the initial larger contracts may bid on an estimated $2 billion in construction work for smaller non-combat ships.

With files from The Canadian Press