BC Ferries awards $165 million contract for LNG powered vessels Transport and Related Services

BC Ferries has awarded a $165 million contract to build three new vessels powered by Liqufied Natural Gas (LNG) to a Polish company.

The ferry corporation announced July 3, that Remontowa Shipbuilding S.A of Gdansk, Poland bags the contract after the only B.C.-based shipyard, Vancouver’s Seaspan shipyard was shortlisted in the bidding process but withdrew their application due to commitments to the federal government.

The whole project is estimated at $252 million with $51 million dedicated to cover taxes and federal import duties when the ferries are supplied to the West Coast commencing in August 2016.

The last ferry is expected to arrive in February 2014, while all three will be capable to operate on either diesel or LNG.

Up to seven vessels of this specific class to be engaged in the fleet within the next coming years. The bidding processing did not entirely based on dollar figures. Instead, BC Ferries was drawn to Remontowa’s bid as a result of their experience with LNG-powered vessels. The dual-fuel proficient vessels provides low fueling costs and deducts environmental impacts, says, BC Ferries vice-president of engineering Mark Wilson.

Last year the company spent $126 million on diesel fuel but as per the numbers cracked internally, the LNG-powered ferries could eliminate that cost in half. The cost-savings related with the ferries is not reliant on whether the proposed LNG boom being promoted by the B.C government comes to materialization - Wilson, added.

Two of the vessels will replace the Queen of Burnaby which presently sails between Comox and Powell River; and the Queen of Nanaimo, between Tsawwassen and the southern Gulf Islands.

The new ferries will be 105 metres in length, and capable of holding 145 vehicles and 600 passengers.

The third boat will be used for relief purposes.

Among the provisions agreed with Remontowa is a deal stating the shipbuilder will have to pay a $20,000 a day penalty if the ships are more than two weeks late. The penalties max out at $6 million, but BC Ferries can annul the contract and get a full payback if the ships are six months late.

Calls to BC Ferries were not returned by deadline.