Fired contractor of North Shore sewage plant claims it's owed $100 million

Oct 18 2021, 6:34 pm

Acciona Infrastructure Canada is calling Metro Vancouver Regional District’s decision to terminate its $1-billion contract to construct the partially-built North Shore Wastewater Treatment Plant “regrettable” and “unnecessary.”

In a statement issued shortly after the regional district announced it had begun the process of terminating the contract, Acciona claims it is owed about $100 million in contracted work for which it has not received payment.

Furthermore, the company claims it is still working on the sewage treatment plant in North Vancouver, conflicting with recent statements by regional district officials that it had “abandoned” the project by suddenly laying off 130 staff.

“We recently streamlined our efforts to focus on core project activities to maintain the project critical path and reduced the overall project workforce of staff and sub-contract trades accordingly until the outstanding disputes are resolved,” reads a statement by Acciona.

Acciona explains that the project has been “fraught with unforeseen challenges from the outset,” and that it “worked diligently, professionally, and in good faith to overcome a continuous array of unforeseen problems starting with the flaws in the design provided by Metro Vancouver as part of the original bid process.”

The contractor initiated several contractual disputes through the agreed resolution process in the contract. It also asserts the regional district has made the project even more challenging to accomplish by requesting over 1,000 major design changes and other alterations to the original contract, while also demanding Acciona take on responsibility for the increased costs and delays.

“For the past six months, Acciona has been meeting with Metro Vancouver officials in good faith to negotiate a way forward,” continues the statement.

“We continue to meet with representatives from Metro Vancouver and remain committed to finding a resolution that will satisfy both parties and be in the best interests of the residents of the region. It is regrettable that Metro Vancouver has chosen to take this unnecessary and counterproductive course of action.”

north shore wastewater treatment plant

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

north shore wastewater treatment plant

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

Conversely, the regional district claims it upheld its terms of the contract and made all payments due. The project was originally scheduled to reach completion in 2020 on a $700-million budget, but contract revisions last year shifted the completion date to end of 2023 with a budget of $1.058 billion.

In the latest disputes, Acciona wanted to extend the construction timeline by an additional two years and increase the budget to a level that would be almost double the original $700-million budget, according to the regional district.

The original contract was a fixed-cost, design-build-finance model. Major construction on the project first began in 2018.

Meanwhile, the regional district says it has initiated the process of seeking a new contractor to complete the work.

The new plant is intended to provide wastewater with tertiary treatment — a significant improvement from the primary-only treatment of the Lions Gate facility. When complete, it would treat about 100 million litres per day under normal conditions, and up to 320 million litres per day when storm water enters the sewer system.

Additionally, the plant would have green design features such as using the generated biogas to create electricity for operating the plant and heating the facility, heat recovery capabilities that reduce greenhouse gas emissions by 7,200 tonnes annually, and an odour control system that would make odour undetectable in the adjacent neighbourhood.

The plant is being built on a 7.6-acre former industrial site, previously a rail yard for BC Rail, near the North Vancouver waterfront — just north of Seaspan’s main shipyards hub. The site is framed by West 1st Street to the north, Pemberton Avenue to the east, Phillip Avenue to the west, and railways to the south.

Acciona is also building the new replacement Pattullo Bridge, the SkyTrain Millennium Line Broadway Extension, and Site C hydroelectric dam.

Kenneth ChanKenneth Chan

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