BC Hydro says its monitoring the national security review into a foreign takeover of Aecon Group Inc., the Canadian construction firm leading the preferred partnership tapped to build the Site C dam's generating station and spillways.

Aecon announced Feb. 12 it has pushed the outside date for completing its $1.5-billion sale to China Communications Construction Company Ltd. (CCCC) to March 30, as Ottawa continues its review of the deal under the Investment Canada Act. It's the final hurdle before the deal can close.

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Aecon holds a 30 per cent stake in the the AFDE Partnership, BC Hydro’s preferred bidder to build the civil works portion of Site C’s powerhouse, penstocks, spillways, and power intakes. The partnership also includes Flatiron Constructors Canada, Dragados Canada, and EBC Inc.

BC Hydro had wanted to close its deal with the partnership early this year, and have it mobilize to the site this spring. The Crown utility is monitoring the potential acquisition and considering any impact it will have on the delivery of the work, spokesman Dave Conway said. It expects to award the contract within the next "couple of months" and still have it mobilize to the site in spring, according to Conway.

"BC Hydro is committed to following rigorous standards for all of its procurement activities," Conway said in an email.

"We completed a comprehensive evaluation and due diligence process for the GSS civil works contract and the potential acquisition of Aecon has not changed our overall evaluation of the preferred proponent team."

The federal government has been reviewing the potential sale of Aecon after shareholders voted 99 per cent in favour of the deal with CCCC. Still, it's been hotly contested by Aecon's competitors, who have requested the government block the sale, while the federal Conservative Party has raised concerns over CCCC's ties to China's Communist Party, according to a Globe and Mail report.

Ottawa's review falls under a section of the Investment Canada Act that allows it to gather information on "whether there are reasonable grounds to believe that an investment by a non-Canadian could be injurious to national security."

Aecon said the Competition Bureau has "cleared the transaction," while the Ontario Superior Court of Justice has also given its approval of the arrangement. CCCC, for its part, has received approval from China's National Development and Reform Commission, Aecon said.

"Both companies remain committed to working with the Investment Review Division to obtain approval of the transaction," Aecon said in its announcement earlier this week.

"Completion of the proposed transaction remains subject only to approval under the Investment Canada Act and other customary closing conditions for a transaction of this nature."

If approved, Aecon expects the deal to close by the end of the second quarter.

Aecon CEO John Beck released a statement last week pushing back on "misleading" criticisms of the sale, saying Aecon will continue to be led by its Canadian management team, and will operate within Canadian laws and regulations. Beck also refuted claims of Communist Party influence and government subsidies, while adding the deal has the support of its unions and government agencies that include BC Hydro.

“Aecon welcomes the review on the merits of the proposed transaction and will continue to seek to obtain all the necessary regulatory approvals to close the transaction and get on with the work of building a stronger Aecon and a better Canada," Beck said.

BC Hydro is "confident" in the AFDE Partnership's ability to perform the work, Conway said. It intends to award the generating station and spillways contract "within the next couple of months and the contractor to mobilize to site this spring," he said.

At the same time, BC Hydro has requested an amendment to its environmental assessment certificate to "to reflect improvements to the design of the generating station and spillways," Conway said. A draft request was sent to B.C.'s Environmental Assessment Office in December, with a final request to be submitted in March, Conway said.

Design changes include connecting each of the dam's generators to a transformer upstream of the units, and building the spillways with three radial gates and six low-level outlets to meet water discharge requirements, instead of the seven gates that were originally proposed. The footprint of the station and spillways will remain the same, Conway said.

"These improvements will optimize capacity, minimize environmental risks, improve safety, and facilitate the ease of long-term maintenance during operations," Conway said.

"As with any large construction project, refinements to the design are expected. We do not anticipate any impacts to the cost of the generating station and spillways."

A previous estimate of the design-bid-build contract had been billed around $1.2 billion, however, the cost of the contract won't be known until it's awarded and publicly announced.

BC Hydro has said it will be the second-largest contract awarded for Site C, and within the $10.7-billion budget set by the NDP government.

editor@ahnfsj.ca