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Job cuts possible as Irving considers buying fully-assembled components for Arctic patrol ships

WATCH: Fri, Nov 2: Federal Defence Minister Harjit Sajjan was in town Friday to make that formal announcement, just a day after the shipyard learned it will lose out on maintenance work it's been fighting to keep. Alicia Draus reports.

Irving Shipbuilding says that they may cut as many as 40 shipbuilding positions as they consider purchasing parts used in the construction of Canada’s Arctic and offshore patrol vessels from international markets rather than assembling them in Dartmouth, N.S.

In a statement provided to Global News on Monday evening, Sean Lewis, director of communications for Irving Shipbuilding, said the cuts could come once the company finishes a new “pilot program” they’ve initiated.

READ MORE: Federal procurement minister wishes Irving hadn’t threatened reporters with lawsuit

The program would weigh the benefits of purchasing fully-assembled pipe sections instead of purchasing raw materials and assembling the sections at their Marine Fabricators facility in Dartmouth, N.S.

“The pilot program will provide us with a clear analysis of the cost difference [between the two],” said Lewis.
“At this time, we believe buying fully-assembled pipe sections could result in significant savings that we [will] share with Canada.”

Lewis did not provide a figure for the “significant savings” and said that there will be no impact on ship construction times as a result of any changes.

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There are more than 17,000 pipe assemblies in a single Arctic and offshore patrol vessel.

Lewis confirmed that between 30 and 40 jobs could be affected at the Marine Fabricators facility in Dartmouth.

Government to purchase a sixth Arctic and offshore patrol vessel: Harjit Sajjan
Government to purchase a sixth Arctic and offshore patrol vessel: Harjit Sajjan

If the cuts are carried out, approximately 50 shipbuilders would remain at the facility preparing and cutting steel plates.

He said that all of the shipbuilders affected by the cuts would be offered positions at the Halifax Shipyard.

“Initial discussions have taken place with our Unifor labour unions, and employees at Marine Fabricators,” said Lewis.

A representative for Unifor said they would not comment at this time.

Lewis stressed that Irving has hired “141 new trades personnel” and are “actively recruiting another 28.”

The news of the layoffs comes only months after Ottawa confirmed in May that they would purchase two additional Arctic and offshore patrol vessel for the Canadian Coast Guard.

That would be in addition to the six it was already building for the Royal Canadian Navy.

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

Both Irving Shipbuilding and the Canadian government said at the time that the additional vessels would eliminate a need for layoffs in between the completion of the six original Arctic and offshore patrol vessels and the start of construction on the $60-billion contract for 15 Canadian Surface Combatant ships.

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“Any work performed outside of Canada will be offset by making investments in Canada to ensure that 100% of the value of the AOPS contract is spent here at home,” said Lewis.

— With files from Ross Lord and The Canadian Press