Hanwha Ocean preferred bidder for FFX Batch-III project

Hanwha Ocean was selected as a preferred bidder to build 830 billion won ($631.6 million) worth of battleships for a state-run military procurement agency.

Hanwha Group Vice Chairman Kim Dong-kwan visits a Hanwha Ocean booth at the International Maritime Defense Industry Exhibition (Madex) at Bexco in Busan on June 7. [HANWHA OCEAN]

Hanwha Ocean was selected as a preferred bidder to build 830 billion won ($631.6 million) worth of battleships for a state-run military procurement agency.

The Defense Acquisition Program Administration (DAPA) chose Hanwha Ocean as the preferred suitor for the fifth and sixth frigates for the FFX Batch-III project, also known as Ulsan-Class Batch-III, according to sources in the shipbuilding and defense industries. The formal agreement will be signed between late August and early September.

The decision is a significant milestone for Hanwha Ocean, formerly Daewoo Shipbuilding & Marine Engineering, after it became part of the Hanwha Group.

Hanwha Ocean reportedly achieved a final score of 91.8855 to surpass rival Hyundai Heavy Industries (HD HHI) by a margin of 0.1422 points. Although HD HHI outscored Hanwha Ocean in the technical evaluation, it saw a deduction of minus 1.8 points for unfair practices. A penalty was imposed following the conviction of HD HHI employees who leaked Hanwha Ocean's conceptual design for the next-generation KDDX destroyers back in 2020.

Under the DAPA, the Ulsan-Class Batch-III project will develop six state-of-the-art 3,500-ton frigates to replace aging ones.

HD HHI secured the contract to construct the first ship in March 2020, and the contracts for the second to fourth ships were awarded to SK Ocean Plant.

"Drawing on our exceptional technological competitiveness, our company will exert every effort to contribute to the defense and maritime self-reliance of our nation through the construction of the Ulsan-class frigates," a Hanwha Ocean spokesperson told the Korea JoongAng Daily.

"We have already developed and built the initial frigates and received the highest technical score in the evaluation, and yet, regrettably, we could not secure the contract due to the penalty points," an HD HHI official said. "We will strive even harder to enhance our performance and advance ship development through technological innovation."

BY SEO JI-EUN [seo.jieun1@joongang.co.kr]