LOCATION: Eastern Canada
ISSUE/SOURCE: Eastern Canada Ferry Services
DATE: May 2025
SUGGESTED RESPONSES
- Budget 2019 announced that the Government of Canada would procure two new ferries to replace the MV Madeleine and MV Holiday Island. In summer 2019, the Government of Canada announced that Chantier Davie Canada Inc. would be responsible for designing and constructing the new ferries.
- Pre-construction project activities are progressing, and preliminary design is expected to be completed in Summer 2025. Presently, the shipyard is undertaking processes to select major machinery, including the hybrid electric propulsion systems for both vessels, which will significantly reduce emissions, pollutants and underwater noise.
- The delivery date is being discussed with Chantier Davie in the context of the Government of Canada’s overall program of work. The precise timelines will only be known once a construction contract is in place.
- The build order for the Government of Canada’s remaining program of work with Chantier Davie, including the second ferry vessel, is currently under discussion between the Government of Canada and the shipyard.
BACKGROUND INFORMATION
- Through the Ferry Services Contribution Program, Transport Canada provides funding to private operators to support three interprovincial ferry services in Eastern Canada, including service between: (i) Wood Islands, Prince Edward Island and Caribou, Nova Scotia; (ii) Îles-de-la-Madeleine, Quebec and Souris, Prince Edward Island; and (iii) Saint John, New Brunswick and Digby, Nova Scotia. The vessels and terminals used to provide the services are owned by Transport Canada and are leased to the operators for a nominal amount.
- In Budget 2019, the Government of Canada announced that it would procure two ferries to replace the MV Madeleine, which operated between Quebec and Prince Edward Island, and the MV Holiday Island, which was used to provide service between Prince Edward Island and Nova Scotia. Following a successful Advance Contract Award Notice process, the Government of Canada announced in June 2019, that it would enter into negotiations with Chantier Davie Canada Inc. for the construction of the new ferries.
- The ferries project has been structured in three phases:
Phase 1: Completion of the Preliminary Designs and Class C cost estimates for the new vessels;
Phase 2: Basic Design and Long Lead Items Contract(s); and
Phase 3: Build Contract.
Additional Q&As – New Ferries Project with Chantier Davie Canada Inc
and the Acquisition of the MV Northumberland
New Ferries Project
Q1. What is the status of the new ferries project with Chantier Davie Canada Inc?
A. The ferries project has been structured in three phases:
Phase 1: Completion of the Preliminary Design and Class C cost estimate;
Phase 2: Basic Design and Class B cost estimate; and
Phase 3: Build Contract.
Phase 1 of the project is expected to be completed by the end of July 2025.
Transport Canada is working with Public Services and Procurement Canada on the parameters of a Basic Design contract and Chantier Davie has been engaged on the technical scope of work to be completed. The timing of a potential contract remains to be determined.
Phase 2 will take approximately 16 months to complete. At the end of Phase 2, CDCI will provide Canada with an updated cost estimate, which will inform a construction contract.
Currently, the MV Holiday Island replacement will be the first ferry built by Chantier Davie under the National Shipbuilding Strategy. The build order for the Government’s program of work with Chantier Davie, including the MV Madeleine replacement, is currently under discussion between the Government of Canada and the shipyard.
The delivery date of the MV Holiday Island replacement will be contingent upon future contracts and the achievement of key project milestones associated with the finalization of design work and a construction contract.
Q2. The Government of Canada signed a contract with Chantier Davie Canada Inc in November 2019 for the design of the new ferries. What work has been completed under this contract?
Since the contract was awarded, CDCI has established a Project Management Office and completed several studies necessary for the design work, including a propulsion system study to inform the best type of propulsion system based on environmental and operational objectives.
The Concept Design for the MV Holiday Island replacement has been finalized and Preliminary Design will be completed by July 2025. Work to mature the design is well underway, including the selection of suppliers and equipment for: (i) the Main Power and Propulsion Systems; (ii) Cargo Access Equipment including doors and ramps; (iii) Heating Ventilation and Air Conditioning equipment; and (iv) Accommodations / Interiors. The selection of these critical major machinery components is a key enabler needed to progress the design and ensure that the technical and operational requirements of the vessel will be met.
Q3. How much money has been provided to CDCI to date?
The ancillary contract awarded to Chantier Davie Canada Inc. (CDCI) is a task-based contract, which is expected to increase as new tasks are added to the contract.
IF PRESSED: As of the end of March 2025, Transport Canada has spent roughly $35.6M on the project of which $24.7M has been provided to Chantier Davie.
This funding has covered the following key activities:
- Project Management and Functional Engineering for Chantier Davie;
- Key engineering studies, including related to the best propulsion system reduce underwater noise and GHG emissions;
- Engagement of a design agent by Chantier Davie;
- Final Concept Design for the MV Holiday Island II;
- Concept Design work for the MV Jean Lapierre, which has not been yet completed;
- Preliminary Design for the MV Holiday Island II;
- Selection of preferred suppliers and equipment for vessel major machinery; and
- A cost estimate for the construction of the MV Holiday Island II.
Q4. What is the expected cost of the final construction of the two replacement ferries?
The Government of Canada will enter into negotiations for vessel construction with Chantier Davie Canada Inc. once design work has been completed. The total cost will only be known once a construction contract has been signed. The cost would be made publicly available at that time.
Q5. What are the Government’s key objectives regarding the design of the new ferries?
Important design considerations for the Government of Canada include:
- ensuring safe and reliable service;
- significantly reducing GHG emissions, air pollutants and underwater noise; and
- ensuring redundancy and adequate capacity to address traffic growth over the long term.
Q6. Will the new ferries reduce GHG emissions. What type of propulsions systems will be used?
The new ferries will have diesel-electric hybrid propulsion systems with onboard energy storage systems (i.e., batteries) to significantly reduce greenhouse gas emissions, air pollutants, and underwater radiated noise compared to the existing fleet. They are also being designed to allow for future enhancements to their energy storage systems as technology advances.
With regard to the MV Holiday Island replacement, Transport Canada’s ultimate objective is for the vessel to eventually operate on batteries only.
Q7. Does the Government still intend to build a replacement vessel for the MV Holiday Island now that the MV Northumberland is acquired. Will the Government break its commitment to Chantier Davie?
The Government is currently focused on completing Preliminary Design for the vessel and negotiating a contract for Basic Design. These are critical to moving the project forward.
Acquisition of the MV Northumberland (formerly the MV Fanafjord)
Q1. What modifications were undertaken in Norway?
Conversion and refit work have been completed. The vessel was modified for operational reasons or to comply with regulatory requirements. Key modifications to the vessel include:
- converting the vessel from LNG to diesel, which will allow for a diesel-electric hybrid vessel;
- changes to the passenger areas are being undertaken, including the installation of additional washrooms and new flooring;
- replacing the marine evacuation system;
- installing new fenders; and
- repainting the vessel.
Q2. Why did the Government choose to have the work done in Norway as opposed to Canada?
Transport Canada required a turnkey solution. It was the responsibility of the vessel owner to determine how and where the work would be done. The seller chose to have the work done in Norway.
An Advanced Contract Award Process was used to allow other potential suppliers to submit a proposal that met the requirements of the Advanced Contract Award Notice. No other suppliers submitted a proposal as part of the process.
Q3. Transport Canada originally expected the vessel to be in service during the 2024 operating season, which could have prevented the total disruption of service last fall. Why wasn’t the vessel ready then?
Transport Canada was originally expecting the vessel to be ready for service in Spring 2024. However, there were delays due to ensuring compliance with regulatory requirements.
Two key examples include: (i) the Classification Society determined that additional fire-rated windows were required and this created a delay of over three months because new windows had to be ordered; and (ii) there were issues with a generator that created a delay of approximately six weeks, while it was being repaired.
Q4. When will the MV Northumberland come into service.
The MV Northumberland arrived in Canada on January 26, 2025. The vessel has been on standby since May 1st, and is expected to enter service on June 15th when the two-vessel peak season starts.
Status of MV Confederation and Ensuring Service Reliability
Q1. What is the status of the MV Confederation?
Repairs to the MV Confederation were completed in early December 2024. The vessel entered service on May 1st when the operating season opened.
Q2. How will the Government ensure a reliable two-vessel service between Wood Islands, PEI, and Caribou, NS, that meets traffic demand in 2025 and going forward?
The Wood Islands – Caribou ferry is an essential transportation link that supports the regional economy, and the local communities served by the route.
Transport Canada worked with Northumberland Ferries over the winter to ensure that key preventative maintenance was undertaken for the MV Confederation. The vessel entered service on May 1st when the operating season opened.
The MV Northumberland has been on standby since May 1st, and is expected to enter service on June 15th when the two-vessel peak season starts.
With both the MV Confederation and MV Northumberland, Transport Canada is confident that there will not be a service disruption.
Finally, Transport Canada has engaged a team of marine experts to conduct an operational review of the Wood Islands – Caribou ferry service to determine if there are any deficiencies and to make recommendations to address any issues. Transport Canada expects to receive the report in Summer 2025 and will work with the ferry operator to implement key recommendations.
Transport Canada will the report to determine what information could be disclosed publicly. As part of this process, Transport Canada will need to determine whether any of the information is considered proprietary or commercially sensitive.