South Korea’s Hanwha Ocean has signed a contract with its affiliate Hanwha Philly Shipyard to build a liquefied natural gas (LNG) carrier under a joint-build model.
As explained, Hanwha Philly Shipyard will sign the contract for the construction of an LNG carrier ordered by Hanwha Shipping, an affiliate of Hanwha Ocean, and then subcontract the construction to Hanwha Ocean. The deal, which has an option for one additional vessel, is valued at 348 billion won, or approximately $250 million.
This order is also seen as a significant milestone in contributing to the revitalization of the U.S. shipbuilding and maritime sectors, as it is said to be the first U.S.-ordered, export-market-viable LNG carrier in almost 50 years. According to Shipbuilding history, the last LNG carrier constructed in the North American country, named Louisiana, entered service in 1980.
As disclosed, a significant portion of LNG carrier construction is centered around Hanwha Ocean’s Geoje shipyard in South Korea, but the Philly subsidiary plans to support certification work to meet U.S. laws and maritime safety standards of the United States Coast Guard (USCG).
Units need to meet the standards of the USCG and undergo certification to be registered as U.S. vessels, so Hanwha Philly plans to use its experience to take the lead in this. The project will thus be operated as a joint construction between the two shipyards.
The South Korean player believes the order positions it to secure a technological edge and supply capability in the North American LNG carrier market. It also sees strategic value in the fact that it will be able to preemptively respond to the U.S. federal government’s policy of mandating the export of U.S. LNG cargo using in-country built vessels, which it plans to implement in stages starting in 2029.
Hanwha Ocean claims to be the only company in the world with production bases in Korea and the United States, where it plans to substantially expand its capacity to build LNG carriers through cooperation with its Philly-based subsidiary.
For this purpose, it has been making investments in expanding Hanwha Philly Shipyard’s capabilities since its acquisition for approximately $100 million last December . Since the South Korean player plans to gradually transfer its shipbuilding technology to Hanwha Philly, the investments have been aimed at technological advancements, workforce training, and smart systems.
In addition to this milestone, the South Korean major recently secured an approval in principle (AiP) from the American Bureau of Shipping (ABS) for a cybersecurity solution designed to enhance the overall cyber resilience of floating production storage and offloading (FPSO) units.