POSCO's 3rd Finex Steel Plant

Steelmaker kicks off construction of 3rd blast furnace-free Finex steel plant; Eyes iron mine in North Korea

POSCO kicked off the construction of its third Finex steel plant at its Pohang Steel Complex on June 28. The plant will have an annual capacity of 2.2 million tons of steel, winding up the century-long history of the blast furnace, POSCO said.
The Finex steel technology, developed by POSCO, allows the use of powder iron ores and coal without the cleansing processes to produce crude steel. POSCO will invest 2.2 trillion won in the new plant, slated for completion in 2013, the steelmaker said. The new Finex steel plant will be the largest steel plant not using a blast furnace in the world when completed.
POSCO will now begin to export its brand new steelmaking technology to overseas steel makers, including those in China, with two Finex steel plants currently in operation and a third on line by 2013, two decades after the development of steel production without blast furnaces.
Attending the third Finex steel plant ground breaking ceremony included dignitaries from government, the steel industry and related industries led by Prime Minister Kim Hwang-sik, Vice Minister Yoon Sang-jik of the Ministry of Knowledge Economy and Chairman Chung Joon-yang of POSCO, among others, totaling some 500 people.
Outstanding features of the Finex steelmaking process include the use of cheap iron ores and bituminous coal in powder states, skipping the cleaning process, thus cutting investment and production costs by 15 percent, POSCO said. The new Finex steel plant will boost its productivity by 33 percent, although the cost of construction per ton will be the same as other Finex steel plants, the steelmaker said.
Compared to blast furnaces, the Finex steel plant will only emit 3 percent of sulfur, 1 percent CO2, and 28 percent non-acid dust, making it environmentally friendly and a green technology. When completed, the new steel plant will save some 177.2 billion won annually in various costs including fuel and raw materials.
The blast furnace took 20 years before it was able to produce more than 2 million tons of crude steel, but the Finex process took less than 10 years to produce that much steel, making POSCO a steelmaker with its own technologies for steel production in less than half century in the industry. When the new Finex plant is completed in 2013, the steel output from POSCO Finex steel plants will total 4.1 million tons annually, about 25 percent of POSCO's total annual steel output.
POSCO launched the development of the Finex steel technology in 1992 and built a Finex test plant in 1996. In 2003, the steelmaker built a Finex steel plant with the annual output capacity of 600,000 tons and expanded its capacity to 1.5 million tons in 2007, enough to become a core national technology.
In the meantime, Chairman Chung said the steelmaker will expand its stainless steel plant in China because its product is in such great demand that it charges a $30 to $50 premium per ton, although the stainless steel market is suffering from a glut. If the joint-venture stainless steel company is listed on a Chinese stock market, we can earn from $300 million to $400 million easily, and we would like to invest those funds in our businesses in China, the POSCO chairman said.
During a recent visit to China to attend a dedication ceremony for Zhiangjiagang Pohang Stainless Steel Plant expansion, Chairman Chung told reporters that the annual production demand for stainless comes to 800 tons in China, but 900 tons are produced annually. But POSCO's stainless steel is in such great demand in China that it can be sold at a premium per ton because of its superb quality and, therefore, it is all right to expand its plant's capacity.
Chung also said he is interested in mining iron ore and magnesium in North Korea when South-North relations improve. Chinese firms import a lot of minerals from North Korea, but the Musan Iron Mine has 5 billion tons of iron ore, and it will have enough for South Korean firms to use as well when the situation allows. nw

A group of dignitaries including Prime Minister Kim Hwang-sik, Rep. Lee Sang-deuk and Chairman Chung Joon-yang of POSCO push buttons to kick start the construction of the steel maker's third Finex steel plant at the POSCO Steel Complex in Pohang June 28.

Photo on Courtesy of POSCO