Hanwha Ocean and Algoma Steel sign MOU to support Canadian steel and jobs

Hanwha Ocean, a global shipbuilding and submarine manufacturer, has signed a binding memorandum of understanding (MOU) with Algoma Steel Inc., a leading Canadian producer of hot and cold rolled steel sheet and plate products.

Under the MOU, the two companies agreed to establish a long-term strategic arrangement with Hanwha Ocean’s contribution of up to USD $250 million (approx. CAD $345 million) designed to support facility development and the procurement of Canadian-made steel for CPSP-related submarine construction and MRO infrastructure.

To that end, Hanwha Ocean will provide USD $200 million (approx. CAD $275 million) to Algoma for the potential development of a structural steel beam mill in Sault Ste. Marie, Ontario. In addition, Hanwha Ocean will purchase Algoma products with an aggregate value of up to USD $50 million (approx. CAD $70 million) for use in connection with its CPSP-related commitments, including submarine construction and the development of MRO infrastructure, including facilities planned in Nova Scotia and British Columbia, where the submarine fleet will be fully supported throughout its operational lifecycle. 

The MOU is structured to align with Canada’s Industrial and Technological Benefits (ITB) framework for the CPSP, while supporting Canada’s domestic industrial base and the long-term operational needs of the Royal Canadian Navy. If the contemplated beam mill project goes ahead, the operation would support the creation of new skilled, long-term Canadian jobs.

The Hanwha-Algoma partnership demonstrates Canada’s Buy Canadian policy at work, ensuring that construction and sustainment activities are rooted in domestic supply chains and supporting industrial sovereignty, supply-chain resilience, and high-quality Canadian jobs in an increasingly uncertain global environment. 

Hee Cheul Kim, President & CEO of Hanwha Ocean, said, “This partnership is about working side by side with Algoma as a leading Canadian steelmaker to build something lasting. By anchoring steel production, infrastructure, and long-term sustainment in Canada, we are committed to strengthening Canada’s industrial resilience and supporting a submarine capability that Canadians can rely on today and for generations.”

Rajat Marwah, CEO of Algoma Steel, said, “As we usher in a new era for Algoma with electric arc furnace steelmaking and modernized finishing capabilities, this strategic arrangement with Hanwha Ocean represents a foundational step forward in our diversification strategy. It reinforces our focus on becoming Canada’s leading sustainable steelmaker, aligned with the country’s nation-building priorities in defense and infrastructure. We also recognize and applaud the Government of Canada’s support for policies that strengthen domestic manufacturing, supply-chain resilience, and long-term industrial capability.”

Hanwha Ocean

Hanwha Ocean is a leading global shipbuilder with more than four decades of experience in complex naval and commercial shipbuilding programs. Supported by its large-scale, integrated shipyard in Geoje, South Korea, the company combines proven industrial capacity with operational experience to deliver modern, in-service naval platforms backed by a resilient through-life support model.

Since its establishment in 1973, Hanwha Ocean has delivered more than 1,400 vessels worldwide, and has built deep expertise in the design, construction, and sustainment of submarines and surface combatants for the Republic of Korea Navy. Hanwha Ocean’s shipyards cover an area of approximately 5,000,000 m², employ around 31,000 people, and build approximately 45 commercial and naval ships each year.

For more information about Hanwha Ocean and the KSS-III submarine, visit: https://kss-iii.ca/

Algoma Steel 

Based in Sault Ste. Marie, Ontario, Algoma Steel is a leading Canadian producer of high-quality plate and sheet steel products, proudly supporting critical sectors including energy, defense, automotive, shipbuilding, and infrastructure. Guided by a purpose to build better lives and a greener future, Algoma is shaping the next generation of sustainable steelmaking in Canada.

With the transition to electric arc furnace (EAF) steelmaking and a modernized plate mill, Algoma is redefining how steel is made in Canada. Powered by Ontario’s clean electricity grid, this transformation represents one of the largest industrial decarbonization initiatives in North America and is expected to reduce carbon emissions by approximately 70% once fully transitioned. These advancements provide stability for continued investment in diversification projects aligned with Canada’s evolving needs.