N.S. government ends offer to buy Lunenburg Foundry Shipyard

The province has backed out of a previously announced agreement to buy the Lunenburg Foundry Shipyard.

The government announced in December it was hoping to complete a deal for the historic waterfront site it described as a "key piece of infrastructure."

However, the province now says it is not going ahead after conducting its due diligence.

The government declined an interview but in a statement to CBC News said the agreement would not have been in the best interests of taxpayers.

"It was clear that there would be additional costs that may be appropriate for a private purchaser but not the taxpayer. The ultimate cost is not something we're prepared to ask the taxpayer to absorb at this point," the statement said.

The shipyard has not operated since November 2021.

Liberals call for investigation

As a potential buyer, the statement revealed the province was allowed to access confidential information, but is "not able to publicly share those details."

Opposition Liberal leader Zach Churchill said Nova Scotians deserve to know more specifics.

"I think there was something sketchy going on with this agreement," he said, adding there are a number of unanswered questions.

"Why did the government bid against a private bidder? What were the remediation costs? Why would the province get into purchasing a shipyard which would then compete with other private shipyards in the province?"

Churchill is calling on the Auditor General to investigate.

• Province buys Lunenburg Foundry Shipyard to protect a 'key piece of infrastructure'

Scrutiny over the agreement increased following reporting by AllNovaScotia.com that showed the province outbid two private companies for the property by a significant margin.

Economic Development Minister Susan Corkum-Greek said in the December announcement that the province was hoping to buy the land with the intent to lease it to a private operator, so the site could be preserved at a time when shipyards around the province were already working to capacity.

That was news to the owners of several shipyards in the southwestern part of the province, however, who told the business news website that there was plenty of capacity within the sector to take on more work even without the province's intervention.

AllNovaScotia.com also revealed that there is a family connection between the largest shareholder of the yard and a close confidant of Premier Tim Houston, although parties involved have denied having an involvement in the sale.