Canada set to help bankroll massive ammunition shipments to Ukraine: sources

Canada has signalled it's prepared to get behind a Czech Republic initiative to ship tens of thousands of artillery shells from different countries to Ukraine on an urgent basis.

Although the details are still being finalized, defence sources say the federal government could contribute as much as $30 million to the plan, which was proposed at the opening of the Munich Security conference by Czech Republic President Petr Pavel.

Pavel's government said it has been able to source up to 800,000 shells of NATO-standard calibre, along with shells of other calibres, from unidentified, non-NATO countries. It says it needs financial support to get the ammunition to Ukraine.

Defence Minister Bill Blair said Canada has been talking to the Czechs but wouldn't discuss specifics.

"I've entered into the memorandum of understanding with one of our European allies, the Czech Republic, with respect to perhaps acquiring munitions that they currently have in their possession that will enable us to ... make them available more rapidly to Ukraine as we ramp up our own production," Blair said Monday after announcing that Canada will contribute hundreds of drones to the Ukrainian military.

Canada's allies, meanwhile, fear that Ottawa may choose to invest in munitions production through the Czech Republic while continuing to defer building up domestic weapons manufacturing capacity, said the defence sources, who are familiar with the file but are not authorized to speak publicly.

Blair, meanwhile, said he hopes to have "more to say in the not too distant future about how we're investing in increased Canadian production of munitions."

The Liberal government has for months been studying proposals from two of the country's ammunition makers — General Dynamics Ordnance and Tactical Systems (GDOT) in Valleyfield, Que. and IMT Defence in Ingersoll, Ont. — to ramp up production of the so-called "operational" or M795 variant of the NATO-standard 155 millimetre shell.

Canada currently produces each month about 5,000 of the M107 version of the shell, known as the "training round."

Defence sources say the federal government's hesitation about boosting munitions manufacturing relates in part to the projected $400 million investment needed to build additional production lines.

Deputy Defence Minister Bill Matthews said Canada and the U.S.