The Honourable Rona Ambrose, Minister of Public Works and Government
Services and Minister for Status of Women, along with the Honourable
Peter MacKay, Minister of National Defence, and the Honourable
Kerry-Lynne D. Findlay, Associate Minister of National Defence, today
welcomed the signing of the definition contract with Irving Shipbuilding
Inc. for the Arctic/Offshore patrol ships project through the National
Shipbuilding Procurement Strategy (NSPS) at an announcement at halifax Shipyards.
This is the next contract signed after the ancillary one announced in
July 2012 and it will be followed by a construction contract in 2015.
This definition contract is a task-based contract divided into seven
work packages (or tasks) that could be awarded. With this contract,
Irving Shipbuilding Inc. will refine and complete the Arctic/Offshore
patrol ships design to production level prior to construction in 2015.
The total potential value of the contract is an estimated $288 million
and it will support up to 200 jobs.
Once completed, the definition contract will enable Irving
Shipbuilding Inc. to know exactly what to build and how to build it. It
will ensure that once the build contract is signed, construction of the
ships will begin. At the same time, work will begin on improving and
upgrading the Irving Shipyard to begin full ship construction in 2015.
During the initial discussions regarding the Navy’s Arctic/Offshore
patrol ships, Canada and Irving Shipbuilding Inc. agreed that the first
contract should be a smaller preliminary contract, followed by a larger
definition contract to complete the Arctic/Offshore patrol ships design
to production level, and subsequently an implementation contract to
build and deliver the ships.
This “design-then-build” approach will mitigate both technical and
cost risks by reducing unknowns, and therefore risks, for the building
phase. Once completed, the definition contract will enable Irving
Shipbuilding Inc. to know exactly what to build and how to build it. It
will ensure that once the build contract is signed, construction of the
ships will begin immediately. This approach is also aligned with the NSPS, which is built upon a more collaborative and risk-sharing relationship.
On July 10, 2012, the Government announced the awarding of a
$9.3-million (HST included) preliminary contract to Irving Shipbuilding
Inc. Within this preliminary contract, Irving Shipbuilding Inc. reviewed
the existing Canadian-developed Arctic/Offshore patrol ships design and
specifications, prepared an execution strategy and delivered a proposal
detailing the scope and cost of the subsequent definition contract.
Finally, on March 7, a definition contract with Irving Shipbuilding
Inc. was signed. The total potential value of the contract is an
estimated $288 million (taxes included). The definition contract is a
task-based contract divided into seven work packages (or tasks) that
could be awarded. The first two tasks have been authorized and their
total value is approximately $136 million.
The definition contract will last 30 months and we are on track to start cutting steel in 2015.
The Arctic/Offshore patrol ships will be used by National Defence to
conduct armed seaborne surveillance in Canada’s economic exclusion zone,
including in the Arctic.
The definition contract signed with Irving Shipbuilding Inc. is a
task-based contract divided into the following seven work packages (or
tasks) that could be awarded. With this contract, Irving Shipbuilding
Inc. will refine and complete the Arctic/Offshore patrol ships design to
production level prior to construction in 2015.
- Project Management – This task will include all
work required to ensure effective planning, management, execution,
monitoring and control, and reporting of the definition contract work. - Engineering Design Phase 1 – This task will include
the system engineering activities, integrated logistical support
analysis and supplier engagement activities that are necessary to
demonstrate that the preliminary Arctic/Offshore patrol ship design
meets all of the contract design specification requirements with
acceptable risk and within the cost and schedule constraints. - Engineering Design Phase 2 – This task will include
the system engineering activities, integrated logistical support
analysis and supplier engagement activities that are necessary to
demonstrate that the Arctic/Offshore patrol ship design is a complete
and integrated solution that meets all the contract design specification
requirements with acceptable risk and within the cost and schedule
constraints. - Engineering Design Phase 3 – This task will include
the system engineering activities, integrated logistic support analysis
and supplier engagement activities that are necessary to demonstrate
that the Arctic/Offshore patrol ship design is a complete and integrated
solution that meets all of the contract design specification
requirements and is ready for the start of vessel construction. - Project Implementation Proposal Development – This
task will encompass all the procurement, engineering, production and
estimating activities required to develop the detailed project
implementation proposal, including the required plans and a substantive
cost for the implementation contract. - Test Production Module – This task will include all
the work required to establish and verify production processes and
produce a test module prior to beginning vessel construction. - Long Lead Items Procurement – This task will
encompass all of the procurement and supply chain activities required to
procure long lead items, which must be purchased prior to the start of
vessel construction.
Once completed, the definition contract will enable Irving
Shipbuilding Inc. to know exactly what to build and how to build it. It
will ensure that once the build contract is signed, construction of the
ships will begin.