The Defence Department announced last February that Seaway Marine Inc. of St. Catharines, Ont., was awarded a $21.7 million contract to repair HMCS Athabaskan as part of a scheduled refit. The company was contracted to repair air pressure systems and firefighting and deck equipment, as well as strip, repair and repaint the underwater portion of the hull.
But Charles Payne, the company's president, said inspectors discovered more rust and damage than expected when they examined the 40-year-old destroyer.
"As you remove the paint, you find structural problems and the structural problems are dealt with," Payne said in an interview Friday.
Payne said the navy asked for more repairs, and the final bill came to $26.7 million.
"They (the destroyers) are in very, very poor condition," Payne said in an interview Friday. "That's what caused all this work arising ... the condition of the vessel."
He said the work went on almost two weeks longer than expected.
The Athabaskan suffered damage to its hull while it was being towed back to Halifax and is now moored in Sydney, N.S. The military has said it is assessing that damage and trying to determine when it occurred.
Last Friday, tethering lines broke after the vessel left Sydney and was being towed in rough waters off a rocky shoal, a military spokesman has said.
Payne said the repair work in Ontario was supposed to have been completed in late November, and navy officers were then expected to recommission the destroyer's engines while at the shipyard.
The ship was expected to steam back to Halifax under its own power before the St. Lawrence Seaway closed for the winter. But Payne said because the repairs took longer than expected, there wasn't enough time for the navy to recommission the engines before the seaway closed.
He said the navy then decided to have the vessel towed, rather than leaving it in dry dock over the winter.
The navy issued a brief statement late Friday saying a damage assessment had been completed and temporary, minor repairs were underway to ensure the ship's hull is watertight.
Lt.-Cmdr. Bruno Tremblay said the ship will be towed to Halifax once the repairs are completed, but his email did not say how long that would take.
"Once this work completed, we are highly confident that the ship can safely return to her home port," Tremblay said.
"Once in Halifax, we will be in a position to complete a thorough follow-on assessment and make a decision on any requirement for a more fulsome investigation."
The Public Works Department did not return messages for comment.
HMCS Athabaskan was commissioned on Sept. 30, 1972.
The ship is one of three Iroquois-class destroyers that provide navy task groups with air defence and command and control capabilities.