Canadian Manufacturing

U.K. firm handling submarine maintenance gets 5-year, $531M extension

Company doing the work, Babcock Canada Inc., is wholly owned by a U.K-based engineering firm



ESQUIMALT, B.C.—The Government of Canada has inked a five-year extension to Babcock Canada Inc.’s contract to refit and maintain Canada’s Victoria-class submarines, which were  infamously purchased used in 1998 from the U.K. for $750 million.

The extension exercises the first five-year option period of the Victoria In-Service Support Contract awarded in 2008 to Canadian Submarine Management Group, a joint venture between U.K.-based Babcock International Group PLC and engineering company Weir Canada.

Soon after the contact was awarded, the company changed its name to Babcock Canada and Wier transferred its shares in the joint venture to Babcock, making Babcock Canada wholly-owned by the U.K.-based parent company.

This contract extension has a value of approximately $531 million. It includes options that could bring its duration to 15 years, with a potential maximum value of $1.5 billion.

All heavy maintenance work covered by the in-service support contract will take place at Victoria Shipyards Co. Ltd., in Esquimalt, B.C.

Work under the contract includes planning and managing the refit periods of the submarines; materiel acquisition; all maintenance activities, including Extended Docking Work Periods; and engineering services. An Extended Docking Work Period involves the comprehensive maintenance, repair, overhaul or upgrading of each of the submarine’s more than 200 systems.

Babcock Canada Inc. 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.

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