Wednesday, November 25, 2015

Project Resolve: CEO says Seaspan could Supply iAOR Cheaper/Faster

By Jonathan Whitworth,

Chief Executive Officer, Seaspan ULC

Let’s give the new Liberal government in Ottawa credit for taking a deeper dive into the reported costs associated with Canada’s search for an interim capability to support the Royal Canadian Navy’s supply ship needs in the aftermath of the unanticipated retirement of HMCS Protecteur and HMCS Preserver. This interim capability would provide a needed bridge to the greater capability of the future Joint Support Ship (JSS) to be built at Seaspan’s Vancouver Shipyard.

Notwithstanding the indignation of certain commentators from Quebec, the Davie Shipyard-controlled Shipbuilding Association of Canada (neither Seaspan nor Irving are members of this organization) and some in the media, at the heart of the issue is whether Canada will get value for the reported $750 million it would be spending on a sole-source contract with Chantier Davie. Taxpayers should expect our federal government to have confidence in the answer they give to that question and one clear way of determining best value is through a fair, open and transparent competition.

Since Seaspan’s name has found its way into media articles related to this issue over the past week, I offer facts for the public record.

– Seaspan believes in competition and are proud to have won the federal government’s competition to build the next generation of vessels for the Canadian Coast Guard and Joint Support (supply ships) for the Royal Canadian Navy (RCN) under the National Shipbuilding Procurement Strategy (NSPS).

– With no financial support from either the Province of British Columbia or the federal government we have invested $170 million of our own money to build North America’s most modern shipyard through which we have begun to produce the vessels that make up our initial inventory of work;

– The first of those vessels – the Offshore Fisheries Science Vessel for the Canadian Coast Guard – began construction in June and has 15 of 37 blocks presently under construction and is on plan;

– The engineering and planning phases are well underway on the next two classes of ships to be built in Vancouver. The Offshore Ocean Science Vessel for the Canadian Coast Guard and JSS for the Royal Canadian Navy are both benefiting from the world-class expertise that has been built at the Vancouver Shipyard under NSPS;

– This level of effort is currently providing employment to over 650 people at the Vancouver Shipyard and has resulted in contracts valued at over $321 million being awarded to some 140 Canadian suppliers. These numbers will continue to climb as our NSPS build program increases;

– Project delays that are often attributed to JSS are related to a failed procurement back in 2008 which predates NSPS and is unrelated to our current program. We are currently working to schedule and to budget with our JSS deliverables;

– We have formally expressed interest to Canada, at its request, to support the RCN’s interim capability need with a converted containership, similar to that offered by Davie but at a significantly lower price and faster, through our Victoria Shipyards. The work would be performed without compromise to our capacity at Vancouver Shipyards which will deliver JSS to Canada, in 2020;

– Seaspan’s Victoria Shipyards, and its trades-men and women, have enjoyed a very successful long-term relationship with the RCN including our delivery next summer of the fifth of five extensively refit Halifax Class frigates, each delivered to Canada on-time and on-budget. If Canada opens the interim supply ship project to best value competition, it is the Victoria Shipyard that stands ready to offer a winning, low-cost interim solution as a bridge to the much more capable Joint Support Ship.

We invite journalists and those who comment through the media to come and visit us at Seaspan, in both Vancouver and Victoria, to see with their own eyes why we are bullish on the future.