Article content continued

The vessel was to serve on lease to the Navy as a gap-filler — both Canada’s former supply ships having rusted out — until new ships can be built by Seaspan, at a projected cost of more than $2-billion, as part of the National Shipbuilding Procurement Strategy. That completion date is years away, at best.

Work on Davie’s stop-gap tanker was already under way when, late last week, the Liberal cabinet called a pause, after receiving a letter requesting this from James D. Irving, chief executive of Irving Shipbuilding Inc.

Hundreds of workers at Davie’s yard in Lévis, Que., on the banks of the Saint Lawrence, now face imminent layoff, pending the expiry of a letter of intent between Davie and the federal government at the end of this month. Should the deadline pass with no resumption of work, the government will forfeit an $89-milion break fee.

Both Irving and Seaspan are now advancing interim options of their own, arguing the Davie deal was never subjected to a formal competitive bidding process. Though that is technically true, it appears there was a lengthy consultation with industry, including Irving and Seaspan, before Davie eventually got the nod.

Industry sources say there has been a protracted behind-the-scenes lobbying effort by Davie’s competitors to freeze the Quebec yard out of any share of the massive $34-billion rebuild of the Navy and Coast Guard that was announced by the Harper Conservatives in the fall of 2011. Irving received the lion’s share of that bonanza, some $26-billion worth; Seaspan, $8-billion worth.