I didn’t know that LNG was such an Sustainable energy source. As you mentioned, various technology developments are needed to use LNG better. Then, what is POSCO’s solution for the LNG industry?

First, let me introduce POSCO’s lineup of steel materials for low temperature and cryogenic applications. At POSCO, there is a trio fit for the purpose: 9% nickel steel, high manganese steel, and STS304L. Let’s see each one of them in detail.

l Presenting POSCO’s Trio for the LNG Industry

– No.1: 9% Nickel Steel

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9% nickel steel? Let me guess! It’s a steel product with 9% nickel, right?

Exactly. 9% nickel steel is the most widely used steel for cryogenic application. This is because nickel maintains outstanding strength and toughness even at extremely low temperatures. 9% nickel steel was first developed by an American company, INCO, in 1944, and its safety was proven through model testing in 1960. Since then, it has been widely used as a material for storage tanks of extremely low-temperature use. However, nickel has a downside: it is expensive, and its supply and demand are unstable.
In addition, 9% nickel steel could only be produced by few steelmakers in the past, so domestic shipbuilders had to depend on imports. Fortunately, POSCO succeeded in developing it for the first time in 1993, and after quality stabilization, production for the material has been accelerated from 2007. Recently, POSCO has been in active cooperation with the Big 3 shipbuilders in Korea — Hyundai Heavy Industries, Daewoo Shipbuilding & Marine Engineering (DSME), and Samsung Heavy Industries — to develop their own technology for LNG storage tanks using this material.

– No.2: High Manganese Steel

High manganese steel? Is it steel with a lot of manganese?

You’re right. POSCO started developing high manganese steel for cryogenic application in 2010, and in 2013, succeeded in creating the new material for the first time in the world. The steel contains 22.5 to 25.5% manganese and is not easily damaged even at minus196 degrees Celsius. Unlike conventional carbon steel, which breaks under very low temperatures, high manganese steel can withstand such a harsh condition.

What’s the difference from 9% nickel steel?

Both steel products are applicable to extremely low temperatures, but they have a huge difference: cost competitiveness. Compared to nickel, manganese is more economical and has a stable supply and demand system, thanks to its abundant reserves. The cost of material is about 30% more economical for high manganese steel than 9% nickel steel, and the cost of welding is also much lower as well. Both 9% nickel steel and stainless steel are excellent steel materials for constructing LNG tanks. But since they were quite costly, POSCO developed high manganese steel as an alternative solution to the problem.
According to the regulations of the International Maritime Organization (IMO), only nickel alloy steel, stainless steel, 9% nickel steel, and aluminum alloy steel were permitted to be used as cryogenic materials for LNG tanks on board an LNG carrier. However, in 2018, high manganese steel also received official approval, which shows international recognition of POSCO’s technical excellence.

– No.3: STS304L

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Stainless 304L? I can’t guess this one.

Stainless steel contains nickel as well. 304 means that the stainless steel is “austenitic” at room temperature, and L means that it has low carbon content — under 0.03%. Stainless steel is much more machinable compared to 9% nickel steel and high manganese steel, so it is widely used in thick steel pipes and machinery of LNG plants. However, there are needs from certain clients who wish to use stainless steel for LNG tanks, so POSCO continues to develop technology and provide solutions regarding this steel.

Wow. POSCO developed a new steel product for the LNG industry? That’s amazing. I wouldn’t have imagined that the city gas I use at home was related to POSCO.

Right. But the real solution story hasn’t begun yet. Of course developing a new steel product is significant, but making sure that it is adopted and utilized by clients is much more important. POSCO has been involved in the R&D of LNG tanks with clients for many years so as to make LNG more economical and safer for us. Now let’s talk about our remarkable achievements.

l POSCO’s Solution for LNG!

Among 9% nickel steel, high manganese steel, and STS304L, POSCO’s clients may choose the optimal steel product according to the specifications of the LNG tanks they build. And POSCO provides the best solutions accordingly — regardless of which product it is.

– Solution for 9% Nickel Steel: Reducing Cost for Clients with the World’s Largest Size, Sharing Technology with SMEs!

Following a long period of research, vessels with LNG fuel tanks adopting POSCO 9% nickel steel are finally being constructed. They are none other than ‘HL ECO’ and ‘HL Green’ of Hyundai Samho Heavy Industries. Both vessels are 180,000-ton LNG-powered bulk carriers where POSCO’s 9% nickel steel is applied as materials for their fuel tanks. At the end of this year, both vessels will be delivered to the shipowner, H-Line Shipping. Other than the fuel tanks, POSCO steel plates were used in the body of the ships as well. Put differently, these vessels are the achievements of full localization — from materials to fuel tank technology. And here is another special solution from POSCO. POSCO can produce 9% nickel steel of all thicknesses required for LNG tank production and also “ultra-wide & long” nickel steel as well!

Ultra-wide & long? What’s so special about that?

LNG tank producers manufacture the tanks with 9% nickel steel in flat form and weld them piece by piece to build the tank. However, welding is costly and takes a long time, which has a significant impact on the overall process. So, the issue for POSCO clients was this: ‘How do we reduce the number of weldings?’ Also, the welding material for 9% nickel steel is especially more expensive than conventional steel. That’s why POSCO developed large-sized products to reduce welding points and costs.

When making a tank of the same size, welding 30 sheets of steel would definitely be much more efficient in terms of time and cost than welding 50 sheets of steel.

POSCO currently produces the world’s largest 9% nickel steel for shipbuilding. After six months of R&D, POSCO established a system to produce a product of up to 4.3m x 20m, which previously was limited to 3.85m x 15m. POSCO’s own R&D was important, but what mattered more were the many tasks and regulations to be resolved so as to apply this product in the actual field. So POSCO proactively discussed the quality of nickel steel with the British LR (LLOYD’S REGISTER OF SHIPPING) classification and based on the result, carried out the tank design, structural feasibility review, and performance testing with Hyundai Mipo Dockyard. The COVID-19 pandemic almost precluded the joint research, but POSCO installed a conference calling system for the client and continued cooperation. As a result, the first batch of ultra-wide & long 9% nickel steel could be supplied successfully to Hyundai Mipo Dockyard in April!

So those LNG tanks must be under production now.

POSCO’s ultra-wide & long 9% nickel steel is used in producing LNG fuel tanks for Hyundai Mipo Dockyard’s 25,000-ton DWT carrier for petrochemicals. This carrier is equipped with a dual-fuel engine that can utilize both bunker fuel and LNG. It is like a hybrid car at sea. The vessel will be completed in March next year and delivered to the ship owner, Bermuda’s MERIDIAN.

I’ve heard that Korea is an LNG carrier powerhouse. I also heard that Korean shipbuilders received orders for 118 out of 124 LNG-powered vessels from shipping companies around the world in the last three years — from 2017 to 2019. Now with these LNG tank materials and technology, Korea’s competitiveness is bound to become stronger!

You’re right. POSCO is looking for ways to keep growing together with SMEs who are producing LNG tanks as well as major shipbuilding companies. To help SMEs overcome the long-term recession in the shipbuilding industry, POSCO is providing them with the application technology of 9% nickel steel and high manganese steel on LNG fuel tanks free of charge. POSCO shares processing and welding technologies of 9% nickel steel and high manganese steel and invites global shipping companies to promote the products by SMEs in Korea. Thus, a stable industrial ecosystem where the mill, SMEs, and shipbuilding companies work jointly is created.

– Solution for High Manganese Steel: Breaking New Ground in the LNG Industry with New Material!

So you said that high manganese steel is a new product developed by POSCO, right? Then its application technology must have been developed from scratch.

Since high manganese steel was not a certified material in the LNG industry, it could not be applied to commercial projects in the beginning. So, POSCO worked on getting the material approval first, starting from the Korean Industrial Standard (KS) in 2014 to the American Society for Testing and Materials (ASTM) in 2017 and the International Organization for Standardization (ISO) in 2018, respectively. The first case of high manganese steel applied successfully to LNG tanks is “Green Iris,” Korea’s first LNG-powered vessel, built in 2017. This vessel was built jointly by POSCO and Hyundai Mipo Dockyard and was spotlighted since it was the “world’s largest” LNG-powered bulk carrier that adopts POSCO-developed high manganese steel for the “first time in the world”. Currently, the vessel is in operation on the sea, transporting limestone from Gangwon Province to Gwangyang Works.

So LNG tanks made of high manganese steel are already being used? The progress has been made rapidly!

Recently, an onshore LNG storage tank made of high manganese steel has also commenced commercial operation. In its initial stage, high manganese steel was not registered on the domestic standard or LNG terminal-related design code, so it was necessary to revise the standards first. To verify the safety of these onshore LNG storage tanks adopting high manganese steel, POSCO even constructed and operated a pilot tank.
The test was conducted supposing that the life of the tank is 50 years. The process of filling the tank with LNG and draining it was repeated more than 1,000 times. After the test, the tank was disassembled, and technical evaluation confirmed that there was no problem with the performance of the high manganese steel. In 2019, the Korean Gas Technical Standards Committee listed high manganese steel on the KGS code as verified material for onshore LNG storage tanks, thus enabling commercialization. Soon after, tank No. #5 at Gwangyang LNG receiving terminal was constructed with high manganese steel, with a storage capacity of 200,000 ㎘, and it has been under operation since last April.

▲ POSCO high manganese steel was applied to the LNG fuel tank of Green Iris (left) and the tank No. #5 at Gwangyang LNG receiving terminal (right)

– Solution for STS304L: Developing Independent LNG Storage Tank Model with Stainless Steel!

Another significant achievement is an independent LNG storage tank model made with POSCO STS304L. This model is ‘SOLIDUS’ of Daewoo Shipbuilding & Marine Engineering Co., Ltd. SOLIDUS adopts double stainless steel barriers to prevent LNG leakage and maximize safety. This design technology also obtained certification — to be suitable for application in actual LNG carriers — from the top 5 major global ship classification companies, such as LR (U.K.), ABS (U.S.), and DNV-GL (Norway). POSCO conducted various performance tests of STS304L in an LNG storage environment to support the development of SOLIDUS by Daewoo Shipbuilding & Marine Engineering Co., Ltd.

The cooperation between POSCO and its clients is bearing fruit. It seems that POSCO has succeeded in capturing eco-friendliness and technical competitiveness at once! Will there be more to expect?

POSCO is participating in a study to construct the 6th LNG storage tank at Gwangyang LNG receiving terminal by upgrading its high manganese steel technology. The company also plans to utilize the technology for overseas projects once the international design code has been revised. Recently, a major European oil company that reviewed the application of high manganese steel showed a favorable response for its competitiveness at “Gastech 2020,” an international gas conference. In addition, POSCO is joining forces with its clients so that 9% nickel steel and STS304L can also be the key to the development of LNG tank technology.

12 Years of Sustainable Excellence

In September, the Dow Jones Sustainability Indices (DJSI) once again recognized POSCO for excellence when it comes to sustainable management policies. With the award, POSCO has won DJSI recognition for 12 consecutive years, the only steel company in the world to be so honored.

In this year’s report, POSCO ranked tops among steel companies for risk management, biodiversity, social contribution and stakeholder management.

POSCO Completes Southeast Asia’s First Automotive Steel Plant

In Thailand at the end of August, POSCO held a ceremony to celebrate the completion of Thailand CGL (Continuous Galvanizing Line). POSCO CEO Ohjoon Kwon attended the ceremony, along with more than 250 VIPs and others, including Thailand’s Deputy Prime Minister and Minister for Foreign Affairs Tanasak Patimaprakorn, Minister of Industry Atchaka Sibunruang, Rayong Governor Somsak Suwansujarit, and the Korean Ambassador to Thailand Kwangil Noh.

With the annual production capacity of 450,000 tons, POSCO has expanded its product capacity for automotive steel sheets overseas to 2.25 million tons per year. POSCO next plans on establishing and extending CGL operations in Gwangyang, Korea, and China, bringing its total operations to seven lines in Korea and six lines overseas.

POSCO’s High Manganese Steel Floor Plate Wins Award for Vibration-Resistant Qualities

In August, POSCO won the Jang Young Sil Award in recognition of its special noise-proof floor plates, developed with POSCO E&C. Made with high manganese steel Z clips, PosCozy floor plating is four times more vibration-resistant than general steel, making it ideal for use in apartment buildings.

Around 150 people attended the award ceremony, including the First Vice Minister Namki Hong from the Ministry of Science, ICT and Future Planning. The award was accepted by POSCO Steel Solution Marketing Department’s Managing Director Deokrak Lee and principal researcher Youngdong Yoo.

POSCO’s Financial Picture Continues to Improve in Second Quarter

In July, POSCO announced its second-quarter financial results, with sales reaching 12.86 billion won and 678.5 billion won in operating profits. Construction and energy sales were down slightly, but steel, ICT and other materials showed improvements, with the steel sector’s operating profits up 33.1% from the previous quarter.

The company’s profit margin reached 11.1%, the highest in four years, thanks to the increased sale of high-quality steel, with 3.839 million tons of World Premium products in the quarter, up by 157,000 tons from the previous quarter.

14 Startups Nurtured at POSCO’s Latest Idea Marketplace

In July, POSCO held its 11^th Idea Marketplace, the company’s representative startup support program that helps a variety of startups develop their promising new ideas and find investors. At the latest Idea Marketplace, 14 startups were announced, joining a program where they develop their business plans and gain the help of mentors over a 10-week period.

Since 2011, POSCO has nurtured 122 startups, investing 8.5 billion won into 53 of them. The Idea Marketplace is part of POSCO’s dedication to developing a creative economy and developing jobs.

POSCO’s High Manganese Steel to Build the World Largest LNG-Powered Bulk Carrier

POSCO’s high manganese steel – independently developed for the first time in the world – is set to transform LNG-powered bulk carriers. Until now, the largest cargo capacity of Liquefied Natural Gas (LNG)-powered bulk carriers was 7,000 tons; but, due to the advantages of POSCO’s high manganese steel, these new bulk carriers being built by Hyundai Mipo Dockyard will be able to carry 50,000 tons of freight.

The high manganese steel developed by POSCO contains about 20% manganese, which allows for the construction of LNG tanks are much stronger than the previous tanks, which are usually nickel or aluminum alloys. POSCO officials say they plan on building the overseas market for high manganese steel together with shipbuilders like Daewoo Shipbuilding & Marine Engineering.

With 2016 already three-quarters done, the year is shaping up to be one of the strongest for POSCO. The world steel industry continues to try adjusting to a sometimes challenging global economic climate, but at POSCO, we remain dedicated to pursuing excellence and innovation.

Growth and Giving Back Highlight POSCO’s 2Q

POSCO Starts 2016 with Exciting News from Around the World

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POSCO has recently announced that its high manganese steel, independently developed for the first time in the world, will be used in building the fuel tank of the LNG- LNG-powered bulk carrier. To be built by Hyundai Mipo Dockyard, a versatile Korean shipbuilding company, the LNG-powered bulk carrier will include high manganese steel supplies from POSCO beginning the third quarter of this year.

The largest cargo capacity of any existing LNG-powered bulk carrier has been 7,000 tons so far, but the new ship will be able to carry 50,000 tons of freight, which is about seven times more than its precedents. It will also feature an energy-efficient, eco-friendly dual fuel-capable engine that can run both bunker C oil and LNG. The ship will be completed by the end of next year to be used beginning 2018, and will carry limestone materials from Gangwon-do to Gwangyang Steelworks for POSCO.

POSCO’s High Manganese Steel has Better Performance and Price Competitiveness than Other Alloy Materials

Because POSCO’s high manganese steel contains about 20% manganese, it has the capability to store LNG, which requires to be kept at an extremely low temperature of -162℃. This high manganese steel-made LNG tank is superior to the currently existing nickel or aluminum alloy-made tanks in terms of yield strength, the minimum temperature it can hold, toughness and price.

Since the ship is designed to sail across the ocean, it will be built based on the IFG Code, an International Code of Safety for Ships using Gases or Other Low-flashpoint Fuels. It looks like the high manganese steel will be more likely to be chosen as a material that can handle extremely low temperatures by the International Maritime Organization once the ship sets sail.

POSCO plans to jointly build an overseas market for high manganese steel, with domestic shipbuilders like Daewoo Shipbuilding & Marine Engineering that have a mutually close cooperative relationship.

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On June 30, NCCP Chairman Ahn Chung Young announced the evaluation results for 2014 at its 35^th general meeting at Seoul Palace Hotel.

The evaluation is divided into four grades; best, excellent, satisfactory and fair. One hundred twelve major companies which have great economic influence, according to business type and of impact of shared growth among the top 450 major companies in terms of sales, were assessed. The value of shared growth indexes is quantified by evaluating the shared growth levels of major companies in order to create fair trade and a culture of shared growth among major companies and SMEs.

Only 19 companies, including POSCO, were awarded the highest grade, 37 companies were awarded an excellent grade, 42 companies, including POSCO E&C, received a satisfactory grade and the remaining 14 companies received a fair grade.

Companies who achieve the highest grade receive benefits for one year with the Fair Trade Commission, Ministry of Trade, Industry and Energy, Public Procurement Service and National Tax Service.

POSCO won additional accolades and was selected as one of “The Most Honorable Company” recipients. It has secured this title for three consecutive years along with Samsung Electronics, Hyundai Mipo Dockyard, SK Global Chemicals and SK Telecom. This honor means being recognized as having earned the highest grade and be given the same incentives as the highest grade for an additional year, even in the case of receiving an excellent grade next year.

POSCO will develop “Creating Shared Value” (CSV) programs and policies which promote ways to achieve sustainable partnerships with cooperating companies and plans to continue operating as an exemplary company of shared growth by actively promoting these programs.