Posco will re-define the global steel industry with innovative, next generation iron making technology that replaces conventional blast furnaces, which have been used for over 100 years.
The groundbreaking ceremony for the new FINEX plant was held on August 17, at the Pohang Works. Annual production capacity is expected to be 1.5 million tons.
Construction will be completed at the end of 2006, with a total investment of 1.3 trillion KRW (1.1 billion USD). The new technology will replace processes that originated in the 1500’s and have been regarded as the most competitive production methods for over 100 years. The commercialisation of FINEX will be a major turning point for global steel production technology.
POSCO has invested 420 billion KRW (362 million USD) into research and development for FINEX technology since 1992. In June 2003, the company successfully completed and operated a demo plant with an annual production capacity of 600,000 tons. POSCO has actively promoted commercialisation of the technology, which the company expects to finalize by the end of 2005.
POSCO has had excellent productivity and cost competitive rates since 1968 when Korea did not possess steel making technology. This is attributed to the company’s adaptation and advancement of technologies from the leading foreign steel companies. With the successful development of the company’s FINEX technology, POSCO has now secured its technological independence. The company is expected to take its place as a front running competitor in the global steel market.
The company’s aggressive promotion of its largest scale project this year, in Korea or abroad, is expected to stimulate the faltering Korean economy. At the same time, the FINEX plant project will give POSCO a position of prominence among global steel companies that have been moving toward large-scale mergers to maintain competitiveness.
The FINEX process is an innovative, next generation iron making technology. Molten iron is produced directly using iron ore fines and non-coking coal rather than processing through sintering and coke making. Because the preliminary processing of raw materials is eliminated, the construction of the FINEX plant will cost 8% less to build than a blast furnace facility of the same scale. Furthermore, a 17% reduction in production costs is expected since lower priced raw materials can be used in the FINEX process.
Emission of pollutants will also be drastically reduced. In addition to arsenic dust, levels of SOx and NOx will only be 8% and 4% respectively, of the emissions occurring with the blast furnace process. FINEX has been recognized as an environmentally friendly process, which will increase POSCO’s future competitiveness as raw materials are decreasing and environmental regulations are tightening.
POSCO will position FINEX as its core technology, enabling the company to stand out against others in the global steel industry and increasing its competitiveness. The company will focus on successfully commercialising FINEX and reinforcing its security system for protecting technology.
Once the technology is successfully commercialised by the end of 2005, it will first replace retiring blast furnaces of the Pohang Works. POSCO will pursue opportunities in emerging steel markets like China and India, taking full ownership of projects rather than simply transferring technology. These direct investments will secure POSCO’s position as a technological leader in the global steel industry.