Canada announces contract award for the construction of the River-class destroyers

Today, the Canadian government announced the contract award to local shipbuilder Irving Shipbuilding Inc. for the construction of the River-class destroyers (previously known as Canadian Surface Combatants or CSC) for the Royal Canadian Navy.

Government of Canada press release

Today, the Honourable Bill Blair, Minister of National Defence, the Honourable Jean-Yves Duclos, Minister of Public Services and Procurement and Quebec Lieutenant, and the Honourable Darren Fisher, Minister of Veterans Affairs and Associate Minister of National Defence, announced the implementation contract award to Irving Shipbuilding Inc. (ISI) for the construction of the River-class destroyers (RCD).

Through Canada’s new defence policy, Our North, Strong and Free (ONSAF), the Government of Canada is providing the Royal Canadian Navy (RCN) with the modern ships it needs to support current and future operations while supporting jobs across Canada. The RCD will provide decisive combat power for operations at sea, and in support of joint-force operations ashore, and will support missions conducted as part of counter-piracy, counter-terrorism, intelligence and surveillance, interdiction and embargo, humanitarian assistance, research and rescue, and enforcement of law or sovereignty.

This modern fleet of warships will enable the RCN to respond to Canada’s defence and security commitments. The RCD will be able to perform a broad range of missions with North American Aerospace Defence Command (NORAD), Five Eyes nations, the North Atlantic Treaty Organization (NATO), coalition partners, and other Canadian government departments and agencies.

With an initial value of $8 billion (including taxes) intended to fund the first 6 years of construction, this contract supports the construction and delivery of the initial three ships as well as the development and delivery of necessary training, spares, and maintenance products required to operate and support the ships in service.  

The RCD Initiative is the largest and most complex shipbuilding effort undertaken in Canada since the Second World War. It is at the core of the government’s commitment to revitalize Canada’s marine industry, establish a sovereign shipbuilding capability, and develop a skilled and experienced labour force to renew Canada’s fleets through the National Shipbuilding Strategy (NSS).

Following extensive analysis, the Government of Canada has now established the cost to build and deliver the first three ships at $22.2 billion (excluding taxes). This estimate includes the costs that will be paid to ISI through the implementation contract, as well as costs associated with the delivery of equipment, systems and ammunition that Canada will be acquiring to bring the first three ships into service. 

The RCD Initiative will provide significant and long-standing investments into the Canadian economy. The RCD implementation contract is estimated to contribute $719.3 million annually to Canada’s gross domestic product (GDP) and create or maintain 5,250 jobs annually over the 2025-2039 period. In addition, consumer spending by associated employees is estimated to contribute $191 million annually in additional GDP and 1,545 additional jobs annually to the Canadian economy during the same 15-year period. This initiative will be especially significant to Atlantic Canada, creating more jobs and opportunities in the region that workers can count on.

As indicated in ONSAF, the Government of Canada continues to renew its relationship with Canada’s defence industry based on clarity, certainty and long-term partnership. Through the RCD Initiative, the Government of Canada is investing in Canada’s domestic shipbuilding industry while equipping the RCN with a fleet of modern and effective ships to support operations well into the future. 

Quick facts

• The River-class destroyers will replace the capabilities found in the four retired Iroquois-class destroyers and the 12 Halifax-class frigates with a single combat-capable ship that can meet multiple threats on both the open ocean and in the highly complex coastal environment.
• The River-class destroyers is based on BAE Systems’ Type 26 warship design being built by the United Kingdom and a variant of which is being built for Australia as the Hunter Class Frigate. The River-class destroyers will have enhanced underwater sensors, state-of-the-art radar and modern weapons.
• The first three ships will be named His Majesty’s Canadian Ships Fraser, Saint-Laurent, and Mackenzie, after Canada’s most important waterways that reach the Pacific, Atlantic, and Arctic oceans.   
• This year marks the 15th anniversary of the NSS. Since 2010, the NSS has contributed to ensuring Canada’s sovereignty by equipping the RCN and the Canadian Coast Guard with new vessels and maintaining their existing fleets to protect Canada’s national interests both at home and abroad.
• NSS contracts awarded between 2012 and early 2025 contributed over $36 billion to Canada’s GDP and have created or maintained more than 20,400 jobs annually between 2012 and 2024. 
• The initial implementation contract value is for an agreed contract period of six years, enabling the required work to be executed in that period, with a contract extension to follow as the successful construction progresses.  
• The cost estimate includes the costs that will be paid to ISI through the implementation contract, including material and labour costs associated with ship construction, initial spares and the development of training, maintenance and logistics support products required to support the ships in service, as well as costs associated with the delivery of equipment, systems and ammunition for which Canada is responsible to deliver as Government Supplied Materiel, procured by Canada either through the US Foreign Military Sales Program or through other contracts directly with equipment suppliers.  
• Canada’s Industrial and Technological Benefits Policy applies to the River-class destroyers project, which requires companies to make investments and provide business activities in Canada equal to the value of the related contracts.
• The NSS Value Proposition applies to the River-class destroyers project and requires ISI to reinvest the equivalent of 0.5% of its River-class destroyers contracts in the three priority areas to benefit the greater Canadian marine industry: human resources development, technology investment, and industrial development.
• To help bring the River-class destroyers into service and support them throughout their lifecycle, the Department of National Defence (DND) is building a land-based testing facility on a portion of DND-owned land in Halifax, Nova Scotia. Construction is expected to begin this summer with expected completion in 2027.
• In 2023, the Government of Canada announced that it was investing $463 million (taxes included) in shipyard infrastructure to ensure that ISI has the capability and capacity to enhance build efficiency to meet the River-class destroyers delivery timelines. The Government of Canada and ISI agreed to a strategy that authorizes and funds the infrastructure enhancements in phases. In May 2024, additional funding was provided to support the remaining phases of work. The revised total value of the investment is estimated at $871.7 million (taxes included). 
• Expenditures on major capability acquisitions like the River-class destroyers contribute significantly to Canada’s overall defence spending. As Canada works to reach 2% of GDP spending on defence, we remain focused on ensuring the CAF has the modern capabilities it needs to remain a strong fighting force able to defend Canada’s sovereign territory, North America, and our allies from global threats. Additionally, spending on major equipment such as the River-class destroyers has Canada on track to exceed NATO’s 20% guideline for major equipment expenditures as a share of overall defence spending.

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