Hanwha Philly Shipyard has secured a 348 billion won ($250 million) contract to build a liquefied natural gas carrier, marking the first such order at an American facility since the late 1970s. The Philadelphia-based yard will construct the vessel for affiliate Hanwha Shipping LLC, with an option for a second ship.
The breakthrough order arrives as the US prepares new regulations requiring domestically-built LNG carriers for American energy exports. Starting in 2029, vessels transporting American natural gas between US ports must meet domestic construction requirements under legislation designed to revive the country’s shipbuilding capabilities.
The deal exposes the dramatic decline in American shipbuilding prowess. In the early 1970s, the US government encouraged US shipyards to build LNG carriers, and a total of 16 LNG ships were built. Since then, American yards have built none of these specialized vessels, despite the US becoming the world’s largest LNG exporter.
“We’ve lost that art here in the United States. We can’t even build our own LNG ships here in the United States,” Navy Secretary Carlos Del Toro acknowledged in congressional testimony last year. The admission underscores how far American shipbuilding has fallen behind Asian competitors.
South Korea’s Hanwha Group, which acquired the Philadelphia facility for $100 million in December, will execute most construction at its Geoje shipyard before shipping the vessel to Pennsylvania for final assembly. This hybrid approach aims to transfer advanced Korean shipbuilding technology while meeting US regulatory requirements for domestic construction.
The 174,000 cubic meter vessel, equipped with dual-fuel engines, is scheduled for delivery by January 2028. Hanwha Philly Shipyard will handle Coast Guard certification and final work to ensure the ship meets American maritime standards.
New federal mandates will require at least 1% of US LNG exports to travel on American-built vessels by April 2028, escalating to 15% by 2047. Currently, none of the roughly 800 LNG carriers worldwide meet Jones Act requirements for domestic US trade.
The regulations reflect broader US concerns about shipbuilding security and competitiveness. A 2025 report from the US Trade Representative states that “today, the US ranks nineteenth in the world in commercial shipbuilding, and we build fewer than five ships each year, while the [People’s Republic of China] is building more than 1,700 ships.”
This single order represents a tentative first step toward rebuilding American LNG shipping capabilities, though industry observers question whether domestic yards can compete economically with established Asian builders. The success of Hanwha’s technology transfer model may determine if other companies follow suit.
