Nunatsiaq Online
NEWS: Nunavut July 11, 2014 - 1:09 pm

Nunavut officials promise Inuit training, jobs on Iqaluit airport scheme

Iqaluit airport deal to cost more than $400M over 30 years, requires 15 per cent Inuit construction labour

JIM BELL
Nunavut Premier Peter Taptuna, Economic Development Minister George Kuksuk and Iqaluit deputy mayor Romeyn Stevenson shovel a few kilos of ceremonial cement July 10, when Nunavut officials and contractors marked the start of construction on the new Iqaluit airport complex. (PHOTO BY JIM BELL)
Nunavut Premier Peter Taptuna, Economic Development Minister George Kuksuk and Iqaluit deputy mayor Romeyn Stevenson shovel a few kilos of ceremonial cement July 10, when Nunavut officials and contractors marked the start of construction on the new Iqaluit airport complex. (PHOTO BY JIM BELL)
John Wood, the CEO of Arctic Infrastructure Partners, speaks July 10 during groundbreaking ceremonies for the new Iqaluit airport project. (PHOTO BY JIM BELL)
John Wood, the CEO of Arctic Infrastructure Partners, speaks July 10 during groundbreaking ceremonies for the new Iqaluit airport project. (PHOTO BY JIM BELL)
George Kuksuk, the minister of Economic Development and Transportation, speaks during groundbreaking ceremonies for the new Iqaluit airport project. He said the GN will continue to work with the federal government on improving transportation infrastructure in Nunavut. (PHOTO BY JIM BELL)
George Kuksuk, the minister of Economic Development and Transportation, speaks during groundbreaking ceremonies for the new Iqaluit airport project. He said the GN will continue to work with the federal government on improving transportation infrastructure in Nunavut. (PHOTO BY JIM BELL)

With the roar of a whirling cement mixer threatening to drown out their voices, a large group of Nunavut politicians, civil servants and contractors marked the start of work on their 30-year $400-million-plus Iqaluit airport project July 10 with a promise-laden ribbon-cutting and ground-breaking ceremony.

“We have purposely worked to ensure that the increasing economic opportunities specifically benefit Inuit through this project, meaning training and job opportunities,” Nunavut Premier Peter Taptuna said.

A consortium of companies called Arctic Infrastructure Partners — which the Government of Nunavut picked last summer — will build and run the new airport complex for the next 30 years under a private-public-partnership, or “P3.”

The job includes a big new building to house airport equipment and vehicles, a fancy new terminal, and repaving of the entire runway, along with the addition of a new apron for parking aircraft.

The GN says the price tag, in today’s dollars for the construction phase of the project, stands at $298.5 million.

But that figure does not take inflation or interest rates into account, or the cost of paying the partnership to run the completed airport over 30 years.

Taking all factors into account, the total cost — or “net present cost” — of the project after 30 years is estimated right now at $418.9 million, a GN document said.

But the GN also said that’s cheaper than if they had decided to do each of the three project components by themselves.

The do-it-alone cost would have totalled $518.7 million, the GN estimates.

The P3 partnership includes Bouygues Building Canada, a subsidiary of a big French multi-national.

Along with its Quebec-based subsidiary, Sintra Inc., Bouygues is responsible for overseeing construction.

A Bouygues project manager, John Wood, who previously worked in Wales for Bouygues in the United Kingdom, will serve as CEO of the P3 group.

Subcontractors include Tower Arctic Ltd., Kudlik Construction Ltd. and Stantec, which contributed architectural work. The GN describes Tower Arctic and Kudlik Construction as “local” firms.

A Quebec-based engineering firm called Genivar will act as “external airport operations advisor.”

And a new entity called Nunavut Airport Services Ltd., owned by the Winnipeg Airport Authority, will operate the new airport complex.

Over the life of the 30-year deal, the GN will pay the partnership a total of $278 million in “service payments.”

And altogether, the GN estimates that the “net present cost” of all its payments to the P3 group will total $376.2 million by the end of 30 years.

Tom Sammurtok, the minister of Community Government and Services, the department that manages the GN’s Article 24 Nunavut land claim contracting obligations, promised training opportunities galore for Inuit beneficiaries.

“The Inuit training plan developed by the Arctic Infrastructure Partners will ensure Nunavut beneficiaries are able to attend post-secondary education and get the necessary experience to earn journeyman credentials in areas such as carpentry, plumbing and electrical, said Sammurtok said.

Sammurtok said Inuit will also get a chance to train as firefighters, heavy equipment operators and other occupations after construction is done.

The GN’s agreement with the P3 partnership states that 15 per cent of workers in the construction phase of the project must be Inuit beneficiaries.

If not, the private partners must pay a one-time penalty, calculated according to a formula set out in the deal.

But in the public copy of the contract, the dollar amounts are blacked out.

After construction is completed and operations begin, the P3 partnership must ensure 20 per cent of workers at the new airport are Inuit.

That is supposed to increase, step-by-step every five years, to 60 per cent Inuit labour by the end of the 30-year deal.

Here’s a short summary of who and what’s involved in the Iqaluit airport project.

Who’s building it?

Bouyges Building Canada and Sintra Inc. will build it, with sub-contractors Stantec, Kudlik Construction Inc., and Tower Arctic Ltd.

Genivar provides technical advice and an entity called Partnerships B.C. helped the GN with the procurement process. A company called InfraRed Infrastructure Capital Partners helped finance the deal.

Who will run it?

An entity called Nunavut Airport Services Ltd., a subsidiary of Winnipeg Airports Authority Inc., will operate the airport for the GN — during and after construction — beginning July 21, 2014.

Who pays for it?

At the end of it all, the GN will pay for most of it.

Some of it — $68.7 million — is to be paid during construction, but the GN will pay most of the bill over 30 years.

All GN payments to the P3 group will total $376.2 million after the 30-year deal is done. The GN also spent money on the procurement process.

A federal agency called PPP Canada chipped in $72.8 million to help things get started.

And the P3 partnership borrowed $141.98 million in a bond sale this past September. Those bonds were priced at an interest rate of 5.092 per cent per year over 34 years.

That bond issue was made possible by two things: a federal government decision to raise Nunavut’s debt cap from $200 million to $400 million, and a positive credit rating of Aa1 from Moody’s Investor Services.

How much will it cost?

The total estimated cost after 30 years is $418.9 million.

When will they complete the project?

Work is to be done by August-September of 2017.

Who will work there?

The GN says 15 per cent of the labour force during construction must be Inuit. When the new airport starts operating, 20 per cent of the labour force must be Inuit, rising to 60 per cent by the end of 30 years.

What are they building?

• A new passenger terminal to be located behind the old Ukkivik building off Federal Road.

• A new service building to be located on a vacant lot near the old airport building.

• Runway repaving, a new apron and new runway lighting.

The GN has posted documents related to the Iqaluit airport project on this web page.

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(19) Comments:

#1. Posted by To ponder on July 11, 2014

It’s cute how Inuit always have to have jobs worked into the ‘deal’ for them.

#2. Posted by 15% seems low on July 11, 2014

I believe the community of Iqaluit is roughly 55% Inuit while the territory is closer to 80% Inuit. I wonder how they got to 15% of the labour force having to be Inuit, so for every 20 workers, 3 will be Inuit. Hardly a big impact.

#3. Posted by peter on July 11, 2014

Sad ,how many new schools,new health centres,arenas,dropin centres,could have been built,for this territory,this project will go down,as the biggest waste of money ever.

#4. Posted by Small towner on July 11, 2014

#4, that is so true. And with a possible merger between 2 of the largest airlines that fly with-in Nunavut, what is the point of the new airport terminal if we end up with only have 1 Ottawa flight per day? Wouldn’t the lineup for security be that much smaller, creating enough space for the other baffin flyers?

#5. Posted by tundrabadger on July 11, 2014

#2…it looks like they are planning a gradual increase in the inuit workforce,  allowing for the need for training an such.  Makes sense when you think about it…a gradual steady build up, opportunities for education,  so by the end, the 60% they are building to is sustainable.

#6. Posted by Really? on July 11, 2014

And what’s the future looking like for Nunavut Airports?

We had M.O.T. which was taken away under the threat of unmanned stations with no staff.

#7. Posted by Job on July 11, 2014

This is nothing more than a photo op and empty words.

Both Tower and Kudlik as local sub-contractors are importing workers out of Quebec. Another 2 of the southern contractors are doing the same. Winnipeg Airport Authority under Nunavut Airport Services Ltd is retaining some of ATCO/Narwhal’s staff, but others have been laid off, and NASL are hiring outside Nunavut. Some GN Airport staff are already getting their lay off notices as well.

Welcome to the new North! Oh wait, that’s the way it’s always been! lol wink

#8. Posted by More quotas not needed on July 11, 2014

“The Inuit training plan developed by the Arctic Infrastructure Partners will ensure Nunavut beneficiaries are able to attend post-secondary education and get the necessary experience to earn journeyman credentials in areas such as carpentry, plumbing and electrical”

There is nothing stopping inuit from getting these credentials NOW, they don’t need yet another race-focused program, there is plenty of support available. 

Employers don’t care what someone’s skin colour or culture is, they want someone who will stick with and get the training, who will be reliable, show up for work, and actually get the work done.  There is nothing stopping inuit from adopting those work habits, and having their pick of jobs, in Nunavut or wherever in Canada they choose to go.  There’s no need for another quota, there is a need for those who claim they want jobs to actually step up to the plate and do those jobs.

#9. Posted by Calling Bullshit on the Racists on July 11, 2014

#8 and #1, Inuit preferential hiring and procurement policies are an obligation of government under the Nunavut Land Claims Agreement.

This means that it’s the law. It has been the law for 21 years. You get that? The law.

It also happens to be a law that is protected by our Constitution. If the government violates that law, they can be sued in court and forced to pay millions of dollars in damages and court costs. The government of Nunavut has no choice but to comply with the NLCA.

They are turning over a public government function to a private company, but that private company, as an agent of the government, still has to follow the NLCA. They GN can’t wriggle out of its obligations by privatizing a government service.

IMHO the 15 per cent Inuit labour requirement looks like the bare minimum the Government of Nunavut could get away without incurring legal action from Nunavut Tunngavik for breaching Article 24 and possibly Article 23. It is also a mystery to me how those sub-contractors can claim to be local or Inuit companies. I would say NTI is letting the GN get away with one here.

Anyway, if you are not happy with how constitionally protected law works in Nunavut, there are 12 other provinces that you are welcome to move to and over 170 countries. If you feel so strongly about the issue, start packing your luggage, because the NLCA is here to stay.

#10. Posted by Jonas on July 11, 2014

#9 We all know it’s the law, but that’s not really the point of the critique. 

Those of us who have seen it up close know it for what it really is, systemic hand holding. Part of the collective fantasy that all things escape ‘merit’ in Nunavut.

I suspect you will be weaker for it in the end.

#11. Posted by GN no support for inuits no work no more hope for on July 12, 2014

GN is putting crisis to their inuits and here we all look up to one and only capital city of nunavut they have put promises and thing is a big betrayal to their inuits! They want to be a pain in the butt sure enough we still can open up much more promising land that we can find to much better support more education more activities for our inuits rights GN is putting allotta inuits down GN wants it the hard way for our FELLOW INUITS GN propose an promising which came an disater in nunavut history ever So Inuits what do you think of opening better city much more promising it’s only cause what we experincing their hate riot in nunavut history GN is leaderless helplessness to inuits their only looking for clean people that never violated the law that is one big bullshit that GN is putting their people into waste land! IS IT TIME TO OPEN UP MUCH MORE PROMISING MUCH MORE SUPPORTING TO OUR INUITS MUCH MORE HAPPY FACES STANDING TALL FOR AN MUCH BETTER LEADERSHIP THIS ENOUGH WITH THE GN’S CRUEL

#12. Posted by Local Hire Why So low? on July 12, 2014

“attend post-secondary education and get the necessary experience to earn journeyman credentials in areas such as carpentry, plumbing and electrical”, said Sammurtok said.

Being only a less than 3 year project it means only students attending a trade school next year & maybe in 2016 will be working at airport.  If in plumbing it might be work for 2015 only. Possibly same with electrical in buildings 2015.

Why 15%? The number seems very low. Is that for over all?
Truck drivers why isn’t it 90% -100%?

#8 “Employers don’t care what someone’s skin colour or culture is,”
Not true - it is widely shown across Nunavut.  Look at Northern & Co-op the manager trainee’s are 99% from the south.  Never see a trainee ad wanted hire in Nunavut papers.

Construction tender winners look who are the carpenter asst - a go-for job, a southern.

#13. Posted by Peter on July 12, 2014

#10 actually Inuit will not be weaker at the end, more training and education will only help. It has been a very short time since all the changes happened up here, where as for you and your family, going back generations it has been the same.
So you can continue to look down and throw around your views of us but that will not stop us from working towards our goals while holding into our culture.

#14. Posted by Content Eskimo on July 13, 2014

Ba Humbug.  There will be wide spread nepotism on this project, Inuit and non-Inuit.

#15. Posted by Flustered on July 14, 2014

Cannot believe our Inuit leaders approved a 300 million dollar airport while sooo many of our own are starving and no where to sleep…and the cost of groceries and living is sooo damn flippin high…all that money coulda go towards downsizing the cost of living (rent, food, shelters, etc)...so frustrated with how our leaders operate…like they say the rich get richer the poor get poorer! they forget who got them elected~! I guess its material over people..guess we really live in a materialistic world!

#16. Posted by moving66 on July 15, 2014

#15: the Government can only do so much. In order for Nunavut to improve there must be investment in tangible assets and infrastructure. Spend $300 million on feeding the poor and you’ll have nothing in the end except more hungry mouthes to feed.

The real question is why are the poor reproducing at such a high rate when they cannot feed their existing families? It’s no different than sub-saharan Africa except that birth control is free and widely available in Nunavut.

Stop expecting the Government to do absolutely everything for you!

#17. Posted by SomeGuy on July 15, 2014

It’s 15% in the construction phase so it has a chance to get done on time. If inuit had the reputation of showing up and working hard it would be higher I promise you. #8 and #10 are right on. The hand holding and giving is only hurting people in the long run. It is creating a dependant society that has no understanding of work ethic. As a result productivity and progress is a daily grind and acts as a breeding ground for the issues of this territority to flourish.

And for those who are thinking the money could be better used else where (housing, healthcenters, reduce cost of living, ect) you have unfortunately not put the effort into understanding where the money is comming from. To put it simply: If not for the project the money wouldn’t be there. Did you read the part in the article about the Bonds and the Feds? That alone is almost $215M (would not exist if not for the project).

#18. Posted by Investment Banker on July 15, 2014

Hey #17, a bond is a loan, a debt instrument, not free money. When you sell a bond, you agree to loan somebody your money. In return you get the interest with full repayment before the bond matures.

AIP sold the bonds which means AIP borrowed $142 million at 5.092%. The government of Nunavut will pay AIP and AIP will turn around and pay the bond holders. Which means GN will pay through the nose for the next 30 years so AIP can service its debt. Those bondholders will want their interest cheques every three months for the next 30 years, if not AIP will be in default.

Nice deal for the GN, a big fat longterm debt obligation and they can keep it off the books.

The only free money in this was the $73 million from P3 Canada.

#19. Posted by SomeGuy on July 15, 2014

Investment Banker, thanks for explaining how bonds work but I never said it was free. I said the money wouldn’t be available if not for them. I don’t want people thinking the GN is sitting on $400M and decided to spend it all on an airport instead of other projects as #15 seems to think.

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