The loan is forgivable if the company reaches an employment target of 150 person years of employment over five years, Tourism, Culture, Industry and Innovation said in a news release.
An additional $750,000 in non-repayable funding is being provided by the Research & Development Corp.
The Force Multiplier project involves modifying a Dash-8 aircraft to operate as a special mission aircraft. The aircraft will be used for domestic and international opportunities, including maritime surveillance.
According to the department, the new project has a number of benefits for the province, including new, long-term, high-paying and high-skilled jobs in the developing aerospace sector within the province, new research and development opportunities resulting from a variety of new components and systems that will be installed by PAL Aerospace for the first time and diversification of the provincial economy.
The company has acquired a Dash-8 aircraft and is modifying it with intelligence, surveillance, and reconnaissance (ISR) components. Clients can lease the service interim or long-term. It will also serve as a marketing tool for PAL Aerospace’s capabilities and support training and logistics activities for clients.
It is expected the aircraft will be completed by November 2017, and making its debut at the Dubai Airshow. Over the long-term, and based on market demand, the company expects to create a fleet of four to six similar aircraft.
PAL Aerospace, along with its parent company, Exchange Income Corp., is also investing in the Force Multiplier project.
“PAL Aerospace is a leader in its field, and this project not only demonstrates another success story for the company, but also what can be achieved in the aerospace and defence industry in our province,” Premier Dwight Ball said in the news release.
“This industry leading on-demand intelligence, surveillance and reconnaissance special mission platform will create high-value jobs in the province and will fill a gap that has long existed in the global aerospace and defence market,” said PAL Group of Companies CEO Brian Chafe.
“In 2016, Canada’s Aerospace industry, the leading industry in research and development in Canada, contributed close to $28B to GDP and 208,000 jobs in the Canadian economy, and directly generated $27.2B in revenues, all of which speaks to the tremendous economic opportunities in this sector,” said Jim House, provincial director, Atlantic Canada Aerospace and Defence Association.