Hanwha Ocean has announced a significant strategic move by signing a memorandum of understanding (MOU) with Kanata Clean Power for a major floating liquefied natural gas (FLNG) project in Canada.
This project, valued at approximately $15.7 billion, aims to build a 12 million-ton-per-annum FLNG export facility near Prince Rupert, British Columbia. The agreement is comprehensive, covering potential cooperation in engineering, procurement, and construction (EPC), as well as operations, maintenance, and even long-term LNG offtake. Notably, the plan allows for up to 50% ownership by participating First Nations, aligning with successful Indigenous-led energy models in the region.
However, this deal is more than just an energy play; it's deeply connected to Hanwha's ambitions in the defense sector. The key driver is Canada’s Industrial and Technological Benefits (ITB) policy, which requires companies awarded major defense contracts to invest back into the Canadian economy. Hanwha is a finalist for the Canadian Patrol Submarine Project (CPSP), and this LNG partnership serves as a powerful demonstration of its commitment to creating local value, strengthening its bid ahead of a decision expected as early as summer 2026.
The timing for this venture is also favorable due to several converging factors. First, Asian spot LNG prices have been high, making new export projects from North America's Pacific coast economically attractive. Second, British Columbia's government is actively supporting 'clean-powered' LNG projects through electrification, which de-risks the regulatory path. The recent success of the Indigenous-led Cedar LNG project also proves that this partnership model is bankable.
Finally, Hanwha Ocean brings proven expertise to the table. Having inherited Daewoo Shipbuilding & Marine Engineering's (DSME) experience, which includes building the world's first new-build FLNG, 'PFLNG Satu,' for Petronas, Hanwha has established credibility in executing such complex projects. This combination of strategic defense positioning, favorable market conditions, and technical capability makes this MOU a pivotal development for Hanwha's global ambitions.
- MOU (Memorandum of Understanding): A non-binding agreement between two or more parties outlining the terms and details of a potential partnership or project.
- FLNG (Floating Liquefied Natural Gas): A floating production facility that liquefies natural gas at sea, allowing it to be transported by ship.
- ITB (Industrial and Technological Benefits): A Canadian government policy requiring companies that win large defense contracts to undertake business activities in Canada equal to the value of the contract.