Contractor fired from sewage plant project suing Metro Vancouver for $250 million

April 2021 construction progress on the new North Shore Wastewater Treatment Plant. (Google Maps)

Acciona Infrastructure Canada is pushing back against Metro Vancouver Regional District, after its contract to build the North Shore Wastewater Treatment Plant Project was terminated in Fall 2021.

In a lawsuit filed in BC Supreme Court late last month, the Spanish engineering giant is now seeking about $250 million in damages and unpaid costs from the regional district.

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The sewage treatment facility within North Vancouver District’s industrial waterfront area is only partially built, and facing a cost escalation reaching $1.06 billion as of 2021 — up from $500 million based on a 2020 completion, according to the filing. Acciona was selected by the regional district as the contractor in 2017, and major construction activities first began in 2020.

Acciona alleges the regional district’s technical designs, plans, and specifications for the project are highly problematic, containing numerous major errors that contributed to delays and higher costs in the middle of construction.

It asserts the 7.6-acre site chosen for the project, located near Seaspan’s main shipyards facility west of Lonsdale, is unsuitable for such a facility, resulting in further costs. The former BC Rail site is deemed by Acciona to be too small, and at risk from seismic activity and sea level rise.

North Shore Wastewater Treatment Plant North Vancouver

Site plan of the North Shore Wastewater Treatment Plant. (Acciona/Metro Vancouver Regional District)

Artistic rendering of the North Shore Wastewater Treatment Plant. (Acciona/Metro Vancouver Regional District)

Acciona further alleges the regional district acted wrongfully in failing to work with their team in adjusting the design, cost, and schedule of the project as needed to resolve the challenges. Last year, Acciona unsuccessfully sought a 2025 completion date.

For these reasons, the contractor believes it was wrongly terminated, and is owed compensation for work already performed.

In its rationale for dismissing Acciona, the regional district claimed the company abandoned the project by laying off most of the remaining workers at the construction site last fall. It asserts that it cooperated and worked with Acciona, increased the project’s budget over several occasions, and adjusted the schedule as needed.

Amendments to the contract in 2019 provided Acciona until late 2023 to complete the plant, and this schedule was again shifted to 2024. But last year, according to the regional district, Acciona requested more funding and a further extended construction timeline.

Artistic rendering of the North Shore Wastewater Treatment Plant. (Acciona/Metro Vancouver Regional District)

Project sites for the North Shore Wastewater Treatment Plant. (Metro Vancouver Regional District)

Earlier in March 2022, under a new project management framework, the regional district announced it had chosen PCL Constructors Westcoast Inc. as its new early contractor to carry out a review of Acciona’s design and construction progress to date, create a plan to complete the project, perform some construction, and work with the regional district on a revised project budget and schedule. This initial contract for early contractor work is worth $40 million, but this could eventually lead to PCL taking over the entirety of the project’s remaining construction through a larger future second contractor contract.

According to the regional district, the plant’s design is currently 80% complete, and construction is 37% complete, with only half of the 2.8 million cubic feet of concrete poured to date.

Acciona is also the general contractor for several other major infrastructure projects in BC, including the SkyTrain Millennium Line extension to Arbutus, the new replacement Pattullo Bridge, and the Site C hydroelectric dam.

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