January 26, 2026 Canadian company Algoma Steel Group Inc. entered into a binding memorandum of understanding (MOU) with Hanwha Ocean Co., Ltd.
Both companies have agreed to enter into a long-term strategic agreement with a potential value of US$250 million (approx. C$345 million) under this agreement, including a cash contribution of US$200 million. (about C$275 million) for the potential development of a structural steel beam manufacturing plant in Sault Ste. Marie, Ontario, as well as expected procurement of Algoma products totaling up to $50 million for use in connection with its obligations related to the Canadian Patrol Subsea Project (CPSP), including the construction of submarines and the development of maintenance, repair and overhaul (MRO) infrastructure required to support the fleet throughout its operational lifecycle in Canada.
The Memorandum of Understanding is structured to support Hanwha's commitments Ocean's Industrial and Technological Benefits (ITB) in connection with the CPSP and its intent to strengthen Canada's domestic industrial base while supporting the long-term operational requirements of the Royal Canadian Navy. If the proposed beam mill project is implemented, the operation will contribute to the creation of new long-term jobs in Canada.
The Memorandum of Understanding also states that Algoma will be obligated to produce annual payments to Hanwha Ocean for 10 years after the start of operation of the beam plant of 3.0 percent. net sales of a beam plant based on its financial performance.
Rajat Marwah, CEO of Algoma Steel, said: “As we enter a new era for Algoma with electric steelmaking and upgraded finishing capabilities, this strategic agreement with Hanwha Ocean represents a fundamental step forward in our diversification strategy. We also recognize and welcome the Government of Canada's support for policies aimed at strengthening domestic manufacturing, supply chain resilience and long-term industrial capacity."
