July 23, 1998
(Executive Council)

Province invests in aerospace fabrication facility in Gander

Premier Brian Tobin today announced that the government will contribute $9.5 million of a $20.5 million investment in Newfoundland Bonding and Composites (NB&C), an aerospace fabrication facility to be constructed in Gander. NB&C, a subsidiary of CHC Helicopter Corporation, will construct aerospace airframe components and related high-tech "bonded" materials for the auto industry and other uses. A first principle contract for the new company will be the fabrication of skin panels for the Cormorant helicopters being constructed for the Department of National Defence.

"This is a prime example of strategic cooperative investment aimed toward establishing an aerospace industry in this province," said Premier Tobin. "In this new company, government and CHC, one of the largest helicopter companies in the world with a proven international track record, have come together to build a new opportunity for Newfoundland and Labrador in the aerospace sector. This will create economic development for the area, and make significant strides toward establishing the Gander facility as a hub for aerospace manufacturing operations in Eastern Canada."

CHC Helicopter Corporation will construct a state of the art 60,000 square foot facility in Gander, with an approximate cost of $7 million. As well, CHC's equity investment in NB&C will total $4 million. As a condition of government's investment, the company has also committed to performance targets which require it to create 1,000 person years of employment, equating to 250 jobs over a six year period, starting in 1999.

NB&C will continue to pursue strategic alliances to secure future contracts, and already has a letter of intent from Agusta, an Italian aircraft manufacturer, to provide manufacturing and repair services for their aircraft.

"CHC feels that this business venture is a very positive step towards creating long-term high-tech jobs for Gander," said Craig Dobbin, Chairman and CEO of CHC. "Our company will draw on its proven track record in the aviation industry and capitalize on its purchasing leverage to help ensure growth and success for NB&C."

CHC is part of a consortium of Canadian companies, E. H. Industries, which was awarded the contract to construct 15 AW520 Cormorant search and rescue helicopters for the federal government in January. As part of this contract, the federal government has demanded that the contractor provide effective benefits across the country.

"This facility is a prime example of those benefits coming to life right here in the Gander area," said the premier. "I am pleased to see this province receive a portion of such a significant national contract."

"This fabrication facility is vastly important for Gander and area," noted Sandra Kelly, MHA - Gander. "The 250 jobs it will create are much needed, and will be a boost to the economy of the area. I am pleased to see government and private enterprise working together to establish a niche in this growing industry."

Construction of the facility is expected to begin by September. NB&C will undertake training of its employees during the pre-operation phase. Production is scheduled to commence in September 1999, and the deadline to deliver parts for the Cormorant helicopters is November 1999.

"It is important to note that Gander was not the only site CHC considered for this facility," said the premier. "CHC also considered a site adjacent to its Atlantic Turbine facilities in Summerside, PEI. CHC's Atlantic Turbines was established in the 1980s and in the years since it has become a leading entity in the aerospace industry and a major economic contributor for the Summerside area. We knew that PEI was pursuing this opportunity with CHC. Through strategic investment in NB&C, and indeed in Newfoundland and Labrador's aerospace industry, we have levelled the playing field, securing a foundation for our province in this expanding sector."

Contact:

Heidi Bonnell, Premier's Office, (709) 729-3564

Bob Gosse, CHC Helicopter Corporation, (709) 570-0595

1998 07 23                                9:45 a.m.