Posco to invest $3.3 billion in EV battery material businesses

Posco and related companies will invest 4.4 trillion won ($3.3 billion) over the next decade to produce materials for electric vehicle (EV) batteries on reclaimed land in Gwangyang, South Jeolla.

Prime Minister Han Duck-soo visits a Posco steel mill in Gwangyang in South Jeolla on Wednesday. [YONHAP]

Posco and related companies will invest 4.4 trillion won ($3.3 billion) over the next decade to produce materials for electric vehicle (EV) batteries on reclaimed land in Gwangyang, South Jeolla.

A new industrial complex next to the company's steel-making manufacturing site will process key materials, such as lithium and nickel, and produce hydrogen energy.

This marks the largest investment made in the southwestern province’s history.

The investment plan was introduced during a visit by Prime Minister Han Duck-soo and a delegation to Posco's Gwangyang steel plant and Dongho bay on Wednesday.

Dongho bay, situated on the east side of the Gwangyang Steel Mill, was constructed to prevent coastal erosion of the mill site.

The picture shows a map of Dongho Bay located in the Gwangyang National Industrial Complex. [POSCO]

Posco has been reclaiming land, approximately 2.3 million pyeong (187,900 acres), between the steel mill and Dongho bay since 1989 to expand the mill facilities. Currently, the area is home to Posco’s No. 5 Coke Plant, a raw material yard and a liquefied natural gas (LNG) terminal. In January, Posco International initiated the construction of a second LNG terminal at the landfill site.

What stands in the way of constructing the new complex is a rule that limits the use of the land to steel-related manufacturing.

“Posco aims to leap beyond steel and become a leading eco-friendly future material company, contributing to the national economy,” said Kim Hak-dong, vice chairman of Posco. “To support the company’s growth, there is a need for swift regulatory reform and changes to the development plan of Gwangyang National Industrial Complex.”

The prime minister pledged to support the new project on the reclaimed area.

“The government will complete preliminary announcements for necessary legal revisions in the first half of this year,” Han said.

Posco Research Institute estimates that the investment will have an annual production effect of approximately 3.6 trillion won, an annual value-added effect of approximately 1.3 trillion won, and an employment effect of approximately 9,000 people per year.

BY SEO JI-EUN [seo.jieun1@joongang.co.kr]