Metro Vancouver approves $40M contract to jumpstart work on stalled North Vancouver sewage plant

Metro Vancouver will hire PCL Constructors Westcoast Inc. at a cost of $40 million to act as a general contractor on the stalled new North Shore Wastewater Treatment Plant and jump-start construction on the project.

The board of the regional government endorsed the $40 million contract recommended by staff on Friday.

The contract will see PCL work with Metro staff to finalize a design for the partially constructed project, as well as finalize estimates for construction costs. The company will also work on finishing concrete pouring and early construction work over the summer on a “cost-plus basis”, according to a Metro report.

No final budget estimates until fall

But Metro won’t have updated figures for how much the project will cost to build or when it will be completed until later in the fall, said Jerry Dobrovolny, commissioner for Metro Vancouver.

News about the latest contract comes after Metro cut ties with its former contractor Acciona, in the fall of 2021 over a contract dispute.

At the time, Dobrovolny said the project was two and a half years behind schedule and Acciona had asked for an increase in the budget which would have doubled the original $525 million contract price of the treatment plant. He said the company had also asked for a further two-year extension.

In response, the company said it had performed roughly $100 million in contracted work without payment and that the project had been "fraught with unforeseen challenges from the outset."

Unusual situation

Dobrovolny acknowledged Friday it was an unusual situation to switch contractors on a major infrastructure project partway through. In most cases, work continues and the parties work out disputes over money after the fact, he said.

In the months since work on the site ground to a halt, Acciona crews have been removing equipment from the site.

Acciona was supposed to have finished the project by the end of 2023, four years past its initial opening date.

Dobrovolny said Friday key goals in the coming months include getting the project up and running again and developing accurate cost estimates for its completion.

“It’s much easier for (the new contractor) to have an accurate cost estimate if they're on site, they’ve started to do the work and they fully understand what's remaining to be done,” he said.

While that’s frustrating to wait for, a worse situation “is to have numbers that just keep changing, he said.

Treatment plant is 37% completed

Currently, the North Shore Wastewater Treatment Plant project is budgeted for just over $1 billion, including the cost of the treatment plant, the large pipe that will take treated sewage to the outfall, and a preliminary design for decommissioning the existing Lions Gate plant.

According to a Metro staff report, the regional government has so far spent $498 million on the project. Design of the sewage treatment plant is 80 per cent complete, according to the report, while construction is 37 per cent complete, with about half of the 80,000 cubic metres of concrete poured.

The contract to finish the bulk of construction could be structured as a guaranteed maximum price or a fixed-price contract, said Dobrovolny.

“We’re looking for good value,” he said. “This is a critical piece of infrastructure that will be in place for 50 years, and parts of it will be operating for 100 years.”

Metro Vancouver's annual utility fees are projected to climb 65 per cent on average over the next half-decade to almost $1,000 annually by 2026, a massive spike as the region races to replace costly and aging infrastructure. Three new sewage treatment plants are on the list of projects to be built.