Report: Hanwha Moves to Reflag Korean-Built LNG Carriers Under U.S. Flag

Hanwha Ocean’s U.S. shipping affiliate has announced plans to reflag Korean-built liquefied natural gas (LNG) vessels to the U.S. flag, according to a Business Korea report.

This move follows recent U.S. Coast Guard regulatory changes designed to simplify the reflagging process for foreign-built vessels seeking U.S. registration. These changes are part of a whole-of-government effort to restore U.S. maritime dominance and expedite approval for reflagging applications.

Hanwha Shipping, the company’s U.S. affiliate, confirmed they are “conducting technical due diligence for this transition” and assured compliance with the Alternative Compliance Program (ACP)—a framework that enables foreign-built ships to operate under U.S. regulations—according to the Business Korea report.

The initiative appears to align with favorable policies toward Korea, with Wi Sung-lac, Director of National Security, noting President Trump’s “keen interest in shipbuilding” during a conversation at the NATO summit last week.

While reflagged ships can engage in international operations under the U.S. flag, the Jones Act prohibits them from domestic operations, restricting foreign ships from operating between U.S. ports unless they are built, owned, and operated by U.S. nationals.

The reflagging initiative builds upon Hanwha’s recent expansion into the U.S. market. In December 2024, Hanwha acquired Philly Shipyard—the first instance of a Korean shipbuilder purchasing a U.S. shipyard. In May, the company announced a $72 million investment to transform the facility into a high-tech operation capable of producing up to 10 vessels annually by 2035.

In April, a Hanwha executive revealed plans to construct the first U.S.-built liquefied natural gas carrier, following a proposal from the U.S. Trade Representative that would tax Chinese-built ships to counter China’s industry dominance.

The USTR’s proposal would require LNG carriers exporting U.S. fuel to be flagged and built in the country. However, industry experts have expressed skepticism about these requirements’ feasibility, with the Center for LNG stating that “the proposed maritime restrictions—particularly the requirement to transport US LNG on US-built and flagged vessels—are simply not feasible.”

Currently, Hanwha Shipping is pursuing technical preparations for reflagging while monitoring potential legislative changes that could affect domestic operations within U.S. waters.

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