08/13/2013 04:00 EDT | Updated 10/12/2013 05:12 EDT

Nova Scotia closer to resuming ferry to Maine, negotiates with firm on service

YARMOUTH, N.S. - Nova Scotia's economic development minister says the province will quickly press on with another bidder if negotiations are unsuccessful with a company that was chosen Tuesday to operate a ferry service between Yarmouth and Maine.

Graham Steele said STM Quest Inc. was selected to set up and run the service between Yarmouth and Portland, potentially restoring a link to the United States that was cut almost four years ago, but the government is working on a timeline.

Negotiations with the company — a joint venture between U.S.-based companies ST Marine Ltd. and Quest Navigation — are scheduled to begin later this week and last about three weeks, with an update provided on the progress that's been made in the first week of September, said Steele.

If it appears a deal is unreachable with STM Quest, he said the government will move on to one of the other two bidders that showed an interest in operating the ferry.

"If it looks like it's not going to happen with STM Quest, we're fortunate we have two other proposals of significant quality," Steele said in a telephone interview. "Both are technically capable and experienced in running a ferry service.

"We're comfortable if things don't work out with STM Quest that we do have a good alternative."

The province received three bids last month — the others were from Balearia Caribbean and P&O Ferries — and a committee has ranked those proposals, although Steele wouldn't say which company came second to STM Quest.

The Yarmouth-to-Maine link was discontinued in December 2009 after the provincial government cut its subsidies, which provoked sharp criticism. The province is now offering $21 million over seven years to restart the service.

Yarmouth Mayor Pam Mood said the town has overcome another hurdle in its four-year battle to reinstate the service.

"This is exactly what we were aiming for, exactly where we needed to be and now the negotiations start and we just go forward from here," said Mood, who has not seen the proposal from STM Quest.

"I'm feeling pretty much like we're just headed towards the finish line, the last finishing touches and we're good to go. It's exciting to say the least."

Officials in southwestern Nova Scotia have complained that the loss of the service has closed businesses, led to job losses and hindered the local economy.

Mood said the town was buzzing with excitement on Tuesday.

"Joy. That's all I can say," said Mood from outside of city hall. "Everyone's happy, excited. ... It's just amazing, amazing news."

But the Progressive Conservative party said the NDP government acted too late to help struggling businesses in the region.

"It's about time," said Chris d'Entremont, a Tory who represents the riding of Argyle in the Yarmouth area. "Our economy has been failing without the ferry and without the tourists it brought to our region."

The Opposition Liberals agreed, accusing the NDP of waiting until the end of their mandate to bring back the service as Premier Darrell Dexter must call an election before June 2014.

“Yarmouth and the southwestern part of our province have been economically devastated by the loss of the ferry service," Liberal Leader Stephen McNeil said in a statement.

“While I am happy we will see this vital link returned, I am deeply frustrated that this news will come as cold comfort to all the families and businesses that have been so negatively impacted by the NDP’s actions.”

Two bids were rejected earlier this year after the government said neither met the criteria for a viable operation. One of those submissions came from Quest Navigation, who then went back to the drawing board, said Steele.

He said the criteria for the proposals changed to become more "open-ended" and "flexible" the second time around and that Quest Navigation's revisions and new partnership with ST Marine Ltd. made their bid the most attractive.

For example, Steele said Quest Navigation had previously placed an emphasis on the transportation of freight rather than passengers, which contrasted with a government panel that concluded, among other things, the ferry service should focus on passenger experience.

Steele said it is possible, but not certain, that the service could resume next year.

"We have reached another milestone," Steele told a crowd at a hotel in Yarmouth. "A great deal of work has been done, but a great deal of work remains to be done."

— By Aly Thomson in Halifax