THE CANADIAN Government has agreed to pay C$166 million ($118 million) compensation to Unisys GSG Canada, one of the prime contractors on a Canadian purchase of EH Industries EH101 helicopters, 17 months after the project was cancelled by the incoming Liberal government.

Scrapping the C$5.8 billion programme for 43 EH101s on cost grounds was one of the first actions taken by the Government after it won the federal election in September 1993 (Flight International, 3-9 November. 1993).

Negotiations are continuing with EH Industries, which would have received about C$4.5 billion to build the helicopters.

Unisys and its subcontractors would have received C$1.3 billion for the design and installation of the on-board electronics. The C$166 million is compensation for the work undertaken by Unisys before the contract was cancelled. The figure was arrived at by an independent consultant.

Following cancellation of the EH101, the Government proposed upgrading Canada's Boeing CH-113 Labrador rescue and Sikorsky CH-124 Sea King naval helicopters at an estimated cost of $960 million.

This option has, since been rejected by the Department of National Defence and Ottawa is again looking at alternatives available.

Westland and Agusta intend to bid on the new programme re-offering an off-the-shelf EH101, dubbed the Cormorant.

Source: Flight International