Canadian Govt Exercises USD 531Mln Option for Victoria In-Service Support

The Government of Canada has exercised a five-year extension option for the Victoria In-Service Support Contract with Babcock Canada Inc. for the continued in-service support of the Royal Canadian Navy’s fleet of four Victoria-class submarines.

The $531-million option period was the first for the Victoria In-Service Support Contract which the Government of Canada awarded to the consortium company, Canadian Submarine Management Group, on June 30, 2008.

The in-service support contract was put in place with the intent to provide long-term, performance-managed maintenance activities and technical support to the Victoria-class fleet. The contract was awarded to the Canadian Submarine Management Group, a joint venture between Babcock International Group and Weir Canada.

The contract had an initial term of five years and a maximum value of $370 million for that initial period. The contract also carried a number of optional terms that, based on continuing satisfactory performance by the company, could be exercised to provide for up to another 10 years of submarine fleet support.

The Victoria In-Service Support Contract included material acquisition; repair and overhaul; and engineering services; as well as project management oversight to plan and organize refits of the submarines; and the provision of scheduled refit and maintenance activities.

At the time of the contract award, two submarines were already receiving upgrades and substantive maintenance: Her Majesty’s Canadian Ship (HMCS) Victoria, which was being refitted at the Department of National Defence’s Fleet Management Facility Cape Breton in Esquimalt, B.C.; and HMCS Windsor, which was undergoing its extended docking work period work at Fleet Management Facility Cape Scott, in Halifax, Nova Scotia.

Canadian Submarine Management Group, which became known as Babcock Canada Inc. in 2011, began performing the first contracted extended docking work period on HMCS Chicoutimi in 2010, at the facilities of one of its prime subcontractors’, Victoria Shipyards, in Esquimalt, B.C. Work on HMCS Chicoutimi is expected to be complete in 2013. Babcock Canada Inc. plans to begin the work period for HMCS Corner Brook in 2014.

“The extension of this contract is an important investment in sustaining a key operational capability for our Canadian Armed Forces,” said Minister Findlay. “This is also another important investment in skilled employment in Canada’s marine sector, supporting more than 400 high-quality, skilled jobs across Canada – over 200 in Esquimalt alone.”

Following the completion of HMCS Corner Brook’s refit, Babcock Canada Inc. will continue to conduct extended docking work periods on all four Victoria-class submarines on a cyclical basis.

Currently, HMCS Victoria and HMCS Windsor are operational. HMCS Chicoutimi will complete its docking period later this year followed by sea trials. The objective of this in-service support contract is to ensure that the fleet maintains a steady state of three fully-operational submarines by 2014.

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Press Release, July 5, 2013; Image: Canadian Navy