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GNWT says hospital protected as partner files for creditor protection

While Carillion Canada's future is unclear, the GNWT says that if it goes down, construction and operations of the new Stanton Territorial Hospital shouldn't go with it.

A computer rendering of what the entrance to the new Stanton Territorial Hospital will look like when complete. - illustration courtesy of GNWT

Carillion Canada is one of three partners in the Boreal Health Partnership (BHP), the consortium that got the contract to build the hospital. Its parent company, U.K.-based Carillion LPC, filed for liquidation earlier this month. On Jan. 16, Carillion Canada said it would be unaffected by the issue. On Jan. 25, it announced it was filing for creditor protection in order to stabilize its operations and find solutions to its short-and long-term finance issues.

The GNWT met with BHP after the Jan. 16 announcement, according to Andrew Livingstone, senior communications advisor for cabinet, and will be meeting with the consortium regularly throughout this situation.

"BHP confirmed its obligations under the project agreement," stated Livingstone in an email, "Specifically, the requirement to have a service provider in place if Carillion Canada is subsequently unable to fulfill this role due to receivership."

Livingstone says the P3, public-private partnership, model of the agreement functions to protect the GNWT from any shocks to the contractor, which is considered a separate legal entity.

"It is [BHP]'s responsibility to remedy any adverse operational or other impacts being faced by any member of the consortium," he wrote.

Despite Carillion Canada's change in status, it maintains it will continue work throughout all its Canadian projects, "business-as-usual," according to its Jan. 25 announcement.

"Carillion Canada remains fully operational and continues to deliver services on its existing contracts," stated Livingstone in his email, "which includes planning for the provision of services [for Stanton] after substantial construction is completed in late 2018."