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NSPS – Seaspan’s Vancouver Shipyards selected for non-combat vessels

A yard full of high-spirited shipbuilders greeted British Columbia Premier Christy Clark and Seaspan Marine Corp. CEO Jonathan Whitworth at Seaspan’s Vancouver Shipyards on the afternoon of Oct. 19 upon learning the company had won the bid to build $8 billion worth of non-combat vessels for the Canadian Coast Guard and the Royal Canadian Navy under the National Shipbuilding Procurement Strategy (NSPS).

The NSPS Secretariat chose Seaspan’s Vancouver Shipyards Co. Ltd., of North Vancouver, to build a total of seven ships – offshore science vessels and a polar icebreaker for the Coast Guard and two joint support ships for the Navy.

“Promises made by the federal government were promises kept,” Mr. Whitworth told the crowd. “The National Shipbuilding Procurement Strategy promised to be fair, open and transparent, and it was. We thank the federal government.”

Seaspan will now meet with the federal government to finalize an umbrella agreement before beginning negotiations on individual ship construction contracts.

Mr. Whitworth praised the large team that produced, in only 18 months, the 30,000 pages of Seaspan’s proposal, and acknowledged the company’s partners in the venture and the British Columbia government, noting that Ms. Clark had been an active partner in the process. He also credited First Nations as well as the cities and municipalities that participated and supported the bid.

“Work will begin on design and other planning almost immediately,” Mr. Whitworth said. “We will be investing a further $150 million to $200 million in infrastructure improvements at the yards, with actual shipbuilding beginning by the end of 2013.”

Mr. Whitworth said that while Seaspan was more than capable of building the combat ships in the NSPS program – Irving Shipbuilding Inc., of Halifax, won that bid – he was honoured that Seaspan had been chosen for the non-combat vessels.

The work on the ships will be split – 80 per cent at Seaspan’s North Vancouver yard and the remaining 20 per cent at its facility in Victoria. Major vessel fabrication will take place in North Vancouver, with finishing and electronics installed in Victoria.

“The NSPS strategy was intended to bring predictability to federal ship procurement and eliminate cycles of boom and bust, as well as provide benefits to the entire Canadian marine industry, and we think this a big step in that direction,” said Mr. Whitworth, noting that depending upon the trade, level of experience and similar factors, salaries in the shipbuilding industry range from $40,000 to a high of $120,000.

In her remarks, Ms. Clark said, “Our efforts paid off. There were some who said we couldn’t do it, and others who said we shouldn’t do it. This contract will result in overall economic benefits to the province of well over $15 billion (over the life of the contract), create new jobs almost immediately and produce over 4,000 new B.C. jobs in the next eight years.

”Ms. Clark went on to say that the contract is crucial as the province works to develop a competitive shipbuilding and repair industry. She told the group how the B.C. government had met with western and territorial premiers to present Seaspan’s bid as a unified western proposal.
“This award will boost B.C.’s efforts to rebuild this industry,” she said. “We’d like to build ships for the rest of the world.

”In addition to the direct jobs and economic benefits, it is expected the nearly three-decade program will have a ripple effect through the B.C. economy, impacting technical training facilities, spurring new technological innovation and creating new business opportunities and partnerships.

A Seaspan-commissioned economic study shows that the ‘value chain’ of the work will provide positive impacts to a range of B.C. businesses and industries outside direct shipbuilding. The marine services sector as well as outside service and support fields including legal, engineering, environmental and numerous other sectors would benefit from the NSPS contract.

The economic benefits include provincial and municipal tax revenues estimated at $600 million over the life of the contract.

“Today’s award demonstrates we have the expertise, facilities and fiscal strength to build what Canada needs, on time and on budget,” Mr. Whitworth said. “We have a strong team comprising a diverse group of specialists to deliver the ships.”

Seaspan’s partners include Alion Canada, CSC, Imtech Marine, STX Canada Marine, Genoa Design International and Thales Canada.

“We’re working with suppliers throughout the country to produce vessels that meet Canada’s national needs for decades to come,” Mr. Whitworth said.