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For immediate release
Gatineau, Quebec, December 23, 2008 – The Minister of Public Works and Government Services, the Honourable Christian Paradis, and the Minister of National Defence and Minister for the Atlantic Gateway, the Honourable Peter Gordon MacKay, today announced amendments to the contracts with Sikorsky International Operations, Inc., for the Maritime Helicopter Project.
“These amendments represent a significant accomplishment in getting compliant maritime helicopters with a minimum of delay, while protecting the investment of Canadian taxpayers,” said Minister Paradis. “They will ensure that the Canadian Forces receive the new leading-edge helicopters that they need.”
“The Canadian Forces will now receive their first Cyclone helicopter in November 2010, a date that will allow our men and women in uniform to continue their outstanding work,” stated Minister MacKay. “We’re getting a great aircraft and we have come to the best agreement possible for the Canadian Forces members and for the Canadian public.”
In November 2004, the Government of Canada signed contracts with Sikorsky International Operations Inc. for the Maritime Helicopter Project, to provide 28 helicopters to replace the Canadian Forces Sea King helicopter fleet, as well as 20 years of in-service support and a training facility. In January 2008, Sikorsky formally advised the Government of delays in the original schedule. As a result of in-depth negotiations, these contract amendments were made to minimize the schedule changes, and add valuable cost effective improvements to the helicopters within the original budget of the project.
This project is a large and complex procurement with many factors affecting the delivery schedule. The government has determined that the delays experienced were largely outside the control of the Contractor. The contract amendments provide the best option to the replacement of the Sea King Fleet with new, state of the art, enhanced capability Cyclone helicopters. This will ensure that Sikorsky and its major Canadian subcontractors continue to perform work to provide the Canadian Forces with a helicopter that meets the needs of Canada—helicopters that will have the capacity to operate effectively aboard our Navy ships during military roles and missions both at home and abroad.
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For more information about the procurement process, please contact:
Office of the Honourable Christian Paradis
Public Works and Government Services Canada
Office of the Honourable Peter MacKay
Minister of National Defence and Minister for the Atlantic Gateway
Public Works and Government Services Canada
Media Liaison Office
Department of National Defence
613-996-2353 (local and international)
1-866-377-0811 (anywhere in Canada)
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In November 2004, the Government of Canada announced the signing of two separate but interrelated contracts with Sikorsky International Operations Inc. for the Maritime Helicopter Project. The first contract, worth $1.8 billion, was for 28 fully integrated, certified and qualified helicopters with their mission systems installed, to replace the Canadian Forces Sea King helicopter fleet. The second contract, valued at $3.2 billion, was for the 20-year in-service support for the helicopters, and included the construction of a training facility, as well as a simulation and training suite.
The Maritime Helicopter Project is a large and complex military procurement involving a major contractor and many subcontractors. In complex procurements such as this one, it is not uncommon to encounter delays. In January 2008, Sikorsky formally advised the government of delays in the original schedule. With this agreement, DND will now begin receiving helicopters by 2010.
These contract amendments have an estimated value of $77 million for the 28 helicopters contract and $40 million for the 20 years of In-Service Support contract. These values are based on the Canada/US currency exchange rate of December 2008 and represent less than 3 percent of the MHP investment of $5 billion. The amendments will be funded from within the original project budget.
The amendments represent a significant accomplishment, minimizing the delays to the delivery of compliant maritime helicopters, while protecting the investment of Canadian taxpayers. It will ensure that the men and women of the Canadian Forces receive the new state-of-the-art helicopters they need, prior to the retirement of the Sea Kings. DND will now begin receiving helicopters by November 2010, allowing necessary operational testing and training to begin prior to the delivery of fully capable helicopters starting in 2012, with a complete fleet of helicopters by 2013.
Through these amendments, the government will be able to invest in additional capabilities for the helicopters at significant savings for Canadian taxpayers—an opportunity that would be lost should the helicopters receive upgrades later. The additional money invested now will provide the Canadian Forces with a helicopter tailored to the needs of Canada, including valuable, cost effective additional capabilities that will provide flexibility to address new requirements during the service life of the helicopter.
The first test flight was successfully conducted on November 15, 2008. This represents an important milestone in moving the program forward from the prototype design to the flight test verification stage. Once the project is complete, the Canadian Forces will have helicopters tailored to the unique needs of very diverse operating environments—both at home and abroad.