POSCO Taps Resources Exploration, Steel Production in Colombia

Signs MOUs with Blue Pacific Assets Corp. of Colombia and Fanalca S.A.

POSCO has embarked on projects to explore iron ore and coal deposits and set up a plant to produce steel tubes in Colombia. POSCO Chairman & CEO Chung Joon-yang signed an MOU with Co-Chairman Serafino Iacono of Blue Pacific Assets Corp. of Colombia at the Grand Hyatt Seoul on Sept. 15 to set up a joint venture to explore iron ore and coal deposits in the South American country. POSCO Chairman Chung also inked an MOU with Chairman Alberto Losada of the Columbian automotive parts maker Fanalca S.A. to establish a steel tube plant. The agreements were inked in the presence of Colombian President Manuel Santos, who was in Korea on an official visit.
POSCO plans to set up a joint venture in Colombia with Blue Pacific Assets within this year, and the two companies will also collaborate on projects to build infrastructure such as ports and railways in connection with the resources exploration and development project.
A task force comprising of steel tube experts will be formed within this year to establish a plant with an annual production capacity of 200,000 tons to produce steel tubes, which measure 60.96 cm in diameter. The thick plates, to be used for the production of steel tubes, will be supplied by POSCO.
POSCO officials said that the demand for steel tubes in Colombia is forecast to surge in the years to come since the South American country has no steel tube maker and imports all steel tube needs. In particular, the demand for large-diameter steel tubes is likely to increase due to the brisk implementation of resources exploration and development projects there. POSCO will secure a stable supply of raw materials such as iron ore and coal by making inroads into Colombia while it expects its affiliates to partake in projects to construct infrastructure.
Colombia is the fourth largest economy in the Central and South American regions following Brazil, Mexico and Argentina.
Columbian President Santos said his government plans to provide full support so as to make the investments "win-win ones for POSCO."

POSCO Standing Tall

The company's technological innovation to gain the upper hand over rivals

POSCO, armed with the world's top technological power and product development capability, is competing with global steelmakers such as ArcelorMittal. The steel giant is not resting on its laurels and is maintaining its technological innovation to gain the upper hand over rivals even though it does not own coal or ore mines, which are vital for profitability.
According to a survey conducted and released in June by the U.S.-based steel marketing survey agency, World Steel Dynamics (WSD), POSCO was selected as the most competitive steelmaker for the second consecutive year among 34 steelmakers around the world. POSCO received the highest points in 23 categories including technology, profitability, financial soundness and cost competitiveness.
POSCO maintained the No. 1 position from 2002 to 2004 in the WSD rankings, but yielded the top position to Russian and Indian steelmakers that own their own ore mines including Severstal and Tata Steel. The Korean steelmaking giant recaptured the top position last year through technology and management innovations.
POSCO's representative technology is the FINEX process, a next-generation, eco-friendly core process that allows the use of cheap ore fines and non-coking coal as feedstock. The technology is an innovative steel-making facility replacing the conventional blast furnace process, which has been in use by the global steelmaking industry for almost 100 years. In addition to having significantly lower operating costs and emissions, the FINEX Technology reduces overall construction costs by eliminating the need for sinter and coke plants. The technology proves to save as much as 15 percent in investment and steel-making product costs, compared to the blast furnace process.
POSCO has teamed up with the Research Institute of Industrial Science and Technology, Pohang, and Voestalpine of Austria to develop the FINEX Technology. Their 10-year joint development project led to the latest technology. In June 2003, a demonstration plant with an annual capacity of 600,000 tons of steel employing the technology was successfully inaugurated. In May 2007, a plant with an annual capacity of 1.5 million tons was dedicated with the commercialization of the FINEX Technology, and was put into commercial operation one year later. This past June, POSCO launched a project to build a FINEX steelmaking plant with an annual capacity of 2 million tons.
RELEASE OF WORLD'S BEST AND FIRST PRODUCTS AND TECHNOLOGIES - Late last year, POSCO began to mass produce next-generation twinning-induced plasticity (TWIP) steels in use for automobiles. POSCO's 10-year project led to the development of the TWIP steels, called a 'dream steel' with high strength and tensibility. TWIP steels can reduce the weight of cars by approximately 10 percent, thus leading to lower fuel costs and greenhouse gas emissions. POSCO predicts that TWIP steels will emerge as the mainstay product for producing cars in 2015 when the eco-friendly vehicle era is ushered in in earnest. POSCO is striving to further upgrade TWIP steels in order to gain the upper hand in the global automobile steel sheet market. European steelmakers are also joining the race to develop TWIP steels.
POSCO CHAIRMAN JUNG'S LEADERSHIP - POSCO Chairman Chung Joon-yang has spearheaded the innovation of work processes since his inauguration. For example, he has focused on the realization of the mobile office and submitting one-page reports, a companywide campaign for reducing useless paperwork writing and focusing on making more creative jobs. The one-page report drive is based on the so-called 3S principle ― Short for reporting only substance, Simple for boosting better understanding and Specific for speedier decision-making. POSCO is also seeking to overhaul reporting and instruction practices and communications processes so as to make the one-page report drive a success. Simple reports that do not lead to debates can be done via e-mail messages, and frequent and intermediate reports may be made so as to minimize the changing and rewriting of paperwork. nw

POSCO Chairman Chung Joon-yang

Photo on Courtesy of POSCO