East Isle Shipyard, Prince Edward Island's largest shipbuilder, has secured a new $15 million contract for the construction of two tug boats for the Panama Canal Authority. The new contract will see the company create 15 new jobs and re-hire 112 workers.
"This project is about getting people back to work and developing the local workforce by providing valuable work experiences that will lead to long-term employment," said the Honourable Lawrence MacAulay, Solicitor General of Canada, and Member of Parliament for Cardigan, on behalf of Human Resources Development Canada (HRDC). "I am very pleased East Isle Shipyard secured this major international contract that will have a very positive impact on the local economy."
East Isle Shipyard estimates that $3 million in payroll will be generated as a result of the 127 local positions, and 50 Island businesses will supply $750,000 in goods and services during the construction of the tugs, a year-long process that is expected to get underway in October.
"This is wonderful news for the province and particularly for the community of Georgetown," said Premier Pat Binns. "My government has worked hard to assure the continuation of this important industry and it's good to see East Isle win such an important contract in the international marketplace."
Workers will become multi-skilled in a variety of positions including electric crane operators, shipbuilders, carpenters, electricians, enginefitters, labourers, machinists, maintenance workers, mobile equipment operators, pipefitters and other positions in new product lines. This approach keeps the company more competitive in the global marketplace by training its employees to be more involved in the complete shipbuilding process, minimizing downtime.
"This is a great day for shipbuilding on the Island and it could not have happened without the support of Premier Binns, Minister Currie and Minister MacAulay working on behalf of the federal government through HRDC. In bidding for this contract it was clear that East Isle workers had a proven and recognized reputation for world-class tugs," said Jim Irving, President of J.D. Irving Ltd. "When other nations weighed in with subsidies to tip the scale, the Premier and Minister MacAulay came forward to support shipbuilding on the Island. We have won a $15 million contract with serious interest in more vessels for Panama. This contract will put 112 people back to work and provide added economic benefit to 50 Island businesses. The investment of the province and the federal government has realized a significant return in terms of payroll and economic benefit to the Georgetown area."
Future business for East Isle Shipyard includes options on building an additional two tugs for the Panama Canal Authority, with a possibility of more vessels to follow.
"This is a tremendous vote of confidence for the quality work and expertise of East Isle employees," said Bill Hind, manager of East Isle Shipyard. "We look forward to cutting the first steel for this project in October and will aggressively pursue other future options and opportunities through a quality product for Panama and other countries around the world."
Funding assistance, in the form of a $1.2 million wage subsidy, is being provided under the Canada/Prince Edward Island Labour Market Development Agreement, a co-managed agreement between Human Resources Development Canada and the provincial Department of Development and Technology. LMDA funding is for a two year period – $525,000 this year and $675,000 next year – depending on East Isle's ability to secure additional contracts. East Isle Shipyard will contribute the remaining 50 percent of the wage/salary costs, totaling $1.2 million over two years.
The provincial government will provide an additional $1.2 million – $960,000 this year and $240,000 next year – to cover engineering, design and capital expenditures associated with the construction of these two tugs and new shipbuilding contracts.