Proposed Shipbuilding Centers of Excellence

Sunday, September 20, 2009

Davie Yards Inc. (TSX:DAV) introduced its proposal for the implementation of a National Shipbuilding Procurement Strategy aimed at renewing the federal fleet and building world-class shipbuilding capability in Canada, while providing more predictable work for the maritime industry.

"Davie's proposal is based on our belief that Canadian yards can achieve a competitive position vis-à-vis European yards in building complex ships. In order to create such competitiveness, we are proposing that major federal shipbuilding projects be allocated to a select number of yards that will develop expertise and thus make it possible to secure the right costs and prices for the fleet renewal program," explained Steinar Kulen, President and Chief Executive Officer at Davie.

Davie's proposal endorses the allocation of Major Crown Projects of the fleet renewal program to Centres of Excellence based on the technology required and the nature of the projects. Under such an allocation, one of the Centers of Excellence should focus on building combat ships and the other on building commercial type ships without heavy combat equipment and on developing Canadian expertise on heavy ice class ships. Smaller yards in Canada can be allocated contracts for the smaller and less complex ships mentioned in the program.

The Centres of Excellence selected must be able to cooperate on the work packages for the ships they are allocated. Therefore, Davie and Halifax-based Irving Shipbuilding Inc. have agreed to cooperate by sharing technology, facilities, and capabilities. It has been proposed that the Government select Irving to build combat vessels and Davie to build commercial ships.

(www.davie.ca)

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