Algoma Steel submarine commitment seen as positive for the Sault

Algoma Steel signed a memorandum of understanding with South Korea's Hanwha Ocean, which has pledged $345 million toward a new beam mill in Sault Ste. Marie if its submarine bid is approved; federal officials say the mill could restore up to 500 jobs.

Algoma Steel announced a memorandum of understanding with Hanwha Ocean, a South Korean shipbuilder that is bidding to build 12 submarines for Canada. The agreement ties a $345 million pledge from Hanwha to the possible creation of a structural steel beam mill in Sault Ste. Marie and to purchases of Algoma products if the submarine bid is approved by the Canadian government. Federal officials have indicated a new mill could re-hire up to 500 workers among those facing layoffs this March. Experts and local officials have described the move as an economic opportunity connected to the broader submarine procurement process. Key details: - The MOU commits Hanwha Ocean to provide $345 million to Algoma Steel if its submarine bid is successful and approved by Canada. - Algoma says about $275 million of that commitment would fund development of the structural steel beam mill, with the remainder covering purchases of Algoma products. - Federal statements indicate the mill could re-hire up to 500 of roughly 1,000 workers scheduled for layoffs in March. - The agreement includes a clause that Algoma would make annual payments to Hanwha equal to 3% of the mill's net sales for ten years if the facility opens. - German firm ThyssenKrupp Marine Systems is also bidding to supply the submarines, and experts say a winner could be chosen by the end of 2026. Summary: The MOU links a potential industrial investment in Sault Ste. Marie to an international defence procurement decision, and local officials and economists say it could provide economic relief if carried out. The submarine competition remains contested, with Hanwha and ThyssenKrupp both preparing competitive bids and a selection expected by the end of 2026.