The LES issues the Deals of Distinction Award once a year to the most valuable licensing agreements in 5 sectors: Life Sciences, High Technology, Consumer Goods, Chemicals, Energy, Environment & Materials and Industry-University-Government Interface, or contracts that solved business issues in creative and innovative ways.

From left, Dong-eun Lee leader of the Energy Plant Materials Sales Group, Dr. Andrew Wasson, ExxonMobil Engineering Specialist, Se-don Choo, head of the Energy and Shipbuilding Materials Marketing Department, and Timothy Kinn, ExxonMobil Senior Commercial Advisor.

Last March, POSCO entered into a licensing agreement with ExxonMobil, the world’s largest oil company, for the production and supply of high manganese steel for slurry pipes. For the past 5 years, the two companies jointly developed POSCO’s high manganese steel for ExxonMobil’s oil sand slurry pipes and commercialized it for the first time ever.

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The LES reviewed the licensing agreements of candidates and awarded POSCO and ExxonMobil the honors. The major factors taken into account were the reduction of time from materials development to market application from a standard 10 years to 5 years, and the drastic extension of steel pipe lifespan. The LES believes such improvements will reduce the overall operating costs for the oil sands industry.

Se-don Choo, head of POSCO’s Energy and Shipbuilding Materials Marketing department said, “The performance of POSCO’s high manganese steel has been recognized in various areas through collaboration with global enterprises. I hope that there will be many more cases of mutually beneficial cooperation between POSCO and its partners using high manganese steel in the future.”

POSCO began research & development for this technology in 2013 and invested a total of KRW 55 billion. After POSCO Technical Research Laboratories completed the initial testing, the equipment was transferred over to the Plate Rolling Department at Gwangyang Works for production.

Normally, high manganese is produced by melting solid manganese iron. When the solid manganese alloy iron is injected into a converter (a large container for storing molten iron), the temperature of the molten iron is lowered and then increased again. This leads to additional energy costs and extends the process time. In addition, with this process, refractories in the converter start to wear away as manganese oxide is generated in the process of melting.

To make this process more efficient, POSCO built PosLM (POSCO Liquid Manganese), its own special facility that is capable of storing molten manganese iron.

POSCO has already applied its own high-manganese steel in the oil sand slurry pipes for ExxonMobil, the world’s largest oil company. Also, because of its excellent durability, POSCO also plans to apply its high manganese steel to the inner parts of industrial power transformers and liquefied natural gas (LNG) tanks.

From planning to production, the successful development of the high manganese steel production technology came about as a joint collaboration between POSCO Technical Research Laboratories, steel mills, and POSCO M-tech, the company’s material development unit. This technology received the Innovation Award at the 2016 POSCO Family Technology Awards.

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POSCO CEO Ohjoon Kwon (left) shakes hands with Tom Schuessler, president of ExxonMobil Upstream Research Company, at the signing ceremony between ExxonMobil and POSCO.

ExxonMobil, the world’s largest oil company, upholds strict standards when choosing materials, and for the last five years has been working with POSCO to manufacture and test slurry pipes at worksites. Last year, a 1.2 m long slurry pipe – made with POSCO’s high manganese steel – was installed at ExxonMobil’s Kearl Oil Sands Project in Canada. It demonstrated a resistance to wear five times higher than conventional materials.

With its abrasion-resistant properties, POSCO’s high manganese steel can greatly reduce overall operating costs and increase oil production. “Seamless collaboration has led to the quick commercialization of this new high manganese steel technology, which will set a new standard for oil sands mining operations,” said Tom Schuessler, president of the ExxonMobil Upstream Research Company, who attended the ceremony.

POSCO and ExxonMobil employees pose for a commemorative photo shoot after inking a high manganese steel supply contract at the POSCO Center.

In response to president Schuessler, CEO Kwon suggested furthering their partnership by utilizing high manganese steel in various other businesses within the oil sands industry.

POSCO also plans to use its high manganese steel in the making of heavy construction and bulletproof military equipment as well as steel pipes and facilities to move various minerals including oil sand slurry.

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