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Hanwha builds US-flagged LNG ship

Hanwha Shipping is a U.S.-based subsidiary of Korean shipbuilder Hanwha Ocean. It announced on Tuesday that it had ordered a liquefied gas carrier (LNG), valued at approximately $252 million, from its Pennsylvania-based Hanwha Philly Shipyard.

The agreement stipulates that the ship would be built in Korea, but will have a US flag. The ship is scheduled to be delivered in the first half 2028.

This deal is part of the United States' efforts to revitalize domestic shipbuilding, and expand its fleets of commercial and military ships. Hanwha Systems, Hanwha Ocean and Hanwha Shipyard bought Philly Shipyard in December for $100 million.

This agreement appears to be the first step in expanding the shipyard capacity of the United States, said Jefferies Shipping Analyst Omar Nokta. He noted that the U.S. has the largest LNG market share with nearly 25%.

The companies stated that the majority of the vessel would be built in Geoje's Hanwha Ocean plant, South Korea.

Hanwha Shipping's spokesperson confirmed that workers from Philly Shipyard would be traveling to Geoje, South Korea for training.

Philly Shipyard will be responsible for the regulatory compliance and safety certificates required for U.S. registration.

In April of this year, United States Trade Representative announced that LNG producers will be required to ship 1% their exports using U.S. built ships beginning in April 2029. This percentage will increase to 15% by April 2047.

Hanwha Ocean says the contract has a value of 348 billion South Korean dollars ($252,03 million) with an option to add an additional vessel.

(source: Reuters)