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Ottawa officially launches process to bring 3rd shipyard into national strategy

Minister of Fisheries, Oceans and the Canadian Coast Guard, Jonathan Wilkinson, makes an announcement regarding the future of the Canadian Coast Guard, in Iqaluit on Friday, Aug. 2, 2019. .
Minister of Fisheries, Oceans and the Canadian Coast Guard, Jonathan Wilkinson, makes an announcement regarding the future of the Canadian Coast Guard, in Iqaluit on Friday, Aug. 2, 2019. . THE CANADIAN PRESS/Sean Kilpatrick

The process to bring a third shipyard into the National Shipbuilding Strategy is officially getting underway.

Whichever firm is selected will be tasked with building six newly announced icebreakers that will operate in the Atlantic Ocean and through the St. Lawrence waterways, officials say.

Fisheries and Oceans Minister Jonathan Wilkinson announced the start of the competitive process from Iqaluit on Friday and stressed that the process will take into account technical, operational and financial considerations from bidders — even if only one shipyard were to apply.

Global News first reported on July 24 that the process would launch this month.

READ MORE: What’s behind the Liberals’ shipbuilding strategy shift? In short: everything

The announcement comes after Wilkinson and Prime Minister Justin Trudeau pledged close to $16 billion for a renewal of the aging coast guard fleet; two of the ships will be additional Arctic and Offshore Patrol Ships from Irving Shipyard in Halifax while the other 16 will be multi-purpose vessels from Seaspan in Vancouver.

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But just six months before making that announcement in May, officials had been doubling down in private insisting that no such plans were being considered.

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No deal will be signed with a shipyard before the election and the process to select a winner will likely take about a year based on how similar processes unfolded for the other two firms that are part of the National Shipbuilding Strategy.

The strategy was created by the former Conservative government in 2011 to bolster the domestic shipbuilding industry, which has historically been subject to the boom-bust cycles of government procurement. But it has faced repeated delays and cost increases over the years.

There is only one other Canadian shipyard that is not part of the strategy: Quebec’s Chantier Davie.

READ MORE: Coast guard fleet renewal plan unlikely to yield promised deals before the election

That was the firm at the heart of the Vice-Admiral Mark Norman affair after he was accused of leaking in November 2015 a plan by the Liberals to freeze a sole-sourced deal with Davie for interim supply ships negotiated by the former Conservative government just prior to the 2015 election.

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The Crown stayed its case against Norman earlier this year, citing lack of evidence.

Sources both within and outside the government have told Global News they believe Davie is the only player positioned to benefit from the process.

The decision to open up the strategy has raised questions from defence industry experts about why it is coming so close to an election.

Quebec City, where Davie is located, is politically competitive and the two Liberals in the largely blue region only won their seats in 2015 by single-digit margins.

Davie itself is located in the riding of Conservative MP Steven Blaney.

It was among five firms that had initially been invited to submit proposals to do the work under the original selection process for the strategy but its bid lost because the shipyard was in bankruptcy protection at the time.

It has been aggressively pursuing work on retrofit and maintenance contracts ever since but is not part of the official strategy.

Inclusion in the strategy would open the door to the shipyard being able to bid on a larger range of more lucrative projects.