South Korea’s largest shipbuilding group, Hyundai Heavy Industries (HD), is securing orders for oil tankers at its Southeast Asian shipbuilding bases and plans to expand its production capacity for medium- and large-sized oil tankers at its cost-competitive shipyards in the Philippines.
According to TradeWinds, Greek shipowner Delia Shipping has placed an order with HD Hyundai Heavy Industries Philippines (HHIP) for two 115,000 DWT LR2 product tankers, with a unit price of $76 million and a total value of $152 million. Delivery is expected in 2028.
The order for two LR2 product tankers demonstrates Delia Shipping’s determination to re-enter the market for this vessel type. The company currently owns three tankers: two Aframax tankers built by DH Shipbuilding and one chemical tanker built by HD Hyundai Heavy Industries.
HHIP, which secured this new shipbuilding order, is a wholly-owned shipbuilding subsidiary established in the Philippines in 2024 by HD Korea Shipbuilding & Offshore Engineering(HDKSOE). The facility officially commenced operations in the fourth quarter of 2025 and is currently building a total of eight 115,000 DWT LR2 product tankers ordered by Hong Kong-based Cido Shipping and Nisshin Shipping.
The commencement of operations at HHIP also marks the resumption of shipbuilding activities at the Subic Shipyard after many years. Earlier, HDKSOE had signed a 10-year lease agreement for Dry Dock No. 1 with the Subic Shipyard, which is operated by Cerberus, a U.S.-based private equity fund (PEF) management firm.
According to records, the Subic Shipyard was established in 2006 by the South Korean shipbuilder formerly known as Hanjin Heavy Industries (now HJ Heavy Industries). It grew to become one of the world’s top five shipyards and was the largest shipyard in Southeast Asia at the time in terms of land area. Located on the northern shore of Subic Bay, the shipyard primarily builds large container ships, gas carriers, and oil tankers. It delivered its first newly built vessel in 2008, and at its peak, the shipyard employed over 20,000 people.
Following a prolonged downturn in the shipbuilding industry, Hanjin Heavy Industries Philippines defaulted on a $1.3 billion loan in 2019, prompting the Subic Shipyard to suspend operations and file for bankruptcy. In April 2022, Cerberus acquired the Subic Shipyard for $300 million on a 50-year lease; by that time, the shipyard had been in bankruptcy for three years.
Today, the Subic Shipyard has become a key component of HD Hyundai’s expansion of its shipbuilding base in Southeast Asia. Earlier this year, reports indicated that HD Hyundai plans to expand its order book and production capacity for 115,000 DWT LR2 product tankers at the Subic Shipyard in the Philippines to 10 vessels, increase its workforce to 5,000 employees, and intends to expand the use of its drydocks for the construction of both military and civilian vessels.
In particular, with the Philippine government proposing to the United States that the Subic Bay Naval Base be developed into a shipbuilding base for the U.S. Navy, some predict that the base’s utilization will become more diversified.
As early as May 2022, the Philippine Navy had leased one-third of the shipyard’s area to provide maintenance services for its large vessels, designating it as the “Subic Naval Operations Base.”