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Subic Bay is a bay on the west coast of the island of Luzon in the Philippines , about 100 kilometres (62 mi) northwest of Manila Bay . An extension of the South China Sea , its shores were formerly the site of a major United States Navy facility named U.S. Naval Base Subic Bay , which is now the location of an industrial and commercial area known as the Subic Bay Freeport Zone under the Subic Bay Metropolitan Authority .
The bay was long recognized for its deep and protected waters, but development was slow due to lack of level terrain around the bay.
In 1542, Spanish conquistador Juan de Salcedo sailed into Subic Bay but no port developed there because the main Spanish naval base would be established in the nearby Manila Bay . When the British captured this base in 1762 , the Spanish were forced to find an alternate location and Subic Bay was found to be a strategic and superb port location. In 1884, King Alfonso XII of Spain decreed that Subic was to become "a naval port and the property appertaining thereto set aside for naval purposes."