Canada awarded MDA Space Ltd (TSX: MDA) a $39 million contract on August 5 to equip Royal Canadian Navy Halifax-class ships with surveillance drones, marking the first time Canadian warships will operate Class-2 uncrewed aircraft systems.
The drones will provide long-range surveillance and targeting capabilities for the navy’s Halifax-class vessels, with initial operations expected in 2028 and full deployment by 2032.
The contract, which could extend up to 20 years, represents part of Canada’s broader push to meet NATO’s 2% defense spending target announced in June. The government projects the drone program will contribute $18 million annually to Canada’s economy and sustain 145 jobs.
The Department of National Defence did not disclose the specific drone model. However, a defense analyst on social media has suggested the contract may involve the S-100 Schiebel Camcopter based on MDA Space’s previous work, though this has not been officially confirmed.
The procurement follows Canada’s June announcement of a $9.2 billion defense spending increase for fiscal 2025-26, bringing the country to NATO’s 2% GDP target for the first time since the early 1990s.
Read: Carney Injects $9B In Sprint To NATO’s 2% of GDP Goal On Defence Spending
“These advanced systems will boost our ability to detect and respond to threats at sea, while reinforcing our commitment to innovation and operational readiness in a complex security environment,” Vice-Admiral Angus Topshee, Commander of the Royal Canadian Navy, said in a statement.
The drones will enhance the navy’s Intelligence, Surveillance, Target Acquisition and Reconnaissance (ISTAR) capabilities as part of the ISTAR-UAS project. Defense officials emphasized the systems will extend operational reach and strengthen situational awareness for naval missions, particularly in Arctic waters.
The procurement aligns with Canada’s defense policy outlined in “Our North, Strong and Free,” which prioritizes modernizing military capabilities and strengthening defense partnerships.
Until the new systems deploy, existing CH-148 Cyclone helicopters will continue providing surveillance capabilities for the Halifax-class fleet.
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