No. H044/05
For release March 22, 2005

GOVERNMENT OF CANADA 
ANNOUNCES NEW FINANCIAL 
AGREEMENT WITH NORTHUMBERLAND FERRIES

OTTAWA — The Honourable Lawrence MacAulay, M.P. (Cardigan), on behalf of the Honourable Jean C. Lapierre, Transport Minister, today announced that Transport Canada has reached an agreement in principle with Northumberland Ferries Ltd. that will extend the company's contribution agreement until 2010. In addition, this agreement will allow the ferry service to continue to operate its full season from May to December, providing the same level of service as in past years.

As a result of this new agreement, Transport Canada will provide Northumberland Ferries with $5 million this year, $5.1 million in 2006-2007, and $5.2 million in each subsequent year.

"I am pleased that after some tough negotiations, this new financial agreement could be reached," said Mr. MacAulay. "The Government of Canada recognizes the distinct and important role the Wood Islands-Caribou ferry service provides to the communities it serves and to tourism in both Nova Scotia and Prince Edward Island." 

This new agreement will allow Northumberland Ferries to maintain a two-ship operation and its traditional level of service. The funding will cover operational and maintenance costs, and operating losses will be subject to discussions on measures to minimize and control these losses. In addition, Transport Canada will be responsible for undertaking major repairs and capital investments, such as dry-docking, dredging and major terminal repairs, that were traditionally included in the contribution agreement.

"The communities served by Northumberland Ferries made it very clear how important this service is to them, and the Government of Canada responded by ensuring that the current level of service can be maintained," said Mr. Lapierre. "I am pleased that this agreement will allow ferry services between Nova Scotia and Prince Edward Island to operate until 2010."

Northumberland Ferries Ltd. has been operating the ferry service between Wood Islands, Prince Edward Island, and Caribou, Nova Scotia, since 1941. Transport Canada officials and Northumberland Ferries Ltd. representatives will finalise the details of this five-year agreement by the end of March 2005.

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