Posco International to invest W1tr in energy sector expansion

Posco International headquarters in Songdo, Incheon (Posco International)

Posco International, the trading arm of Posco Group, is poised to invest 1 trillion won ($755 million) exclusively in the energy sector this year, paving the way to establish itself as a globally recognized eco-friendly conglomerate in its key business area.

The company outlined its business plans Tuesday, emphasizing "global expansion" as its mantra for 2024 to strategically bolster its major business value chain.

Specific plans include a threefold increase in natural gas production at Australian liquefied natural gas company Senex Energy by 2025, as part of the investment earmarked for the energy domain. Contracts have been inked with eight local clients so far, including AGL, Aurora and E-Australia, for the sale of a combined 150 petajoules, or nearly 42,000 gigawatt-hours, of energy.

In the midstream segment of the oil production process, efforts are underway to complete the construction of a 200,000-kiloliter capacity storage tank for unit Nos. 7 and 8 by 2026, alongside a strengthened focus on renewable energy initiatives.

Based on the company's onshore wind power experience in Sinan, South Jeolla Province, Posco International is set to venture into offshore wind power, targeting construction of a 2-gigawatt-hour offshore wind power zone by 2030.

Within the motor core division, plans are in place to expand overseas production bases steadily, aiming for a record production number of 7 million units or more by 2030.

The company has already secured 2.86 million confirmed orders for this year, surpassing the previous year's sales of 2.25 million units. To address surging demand, Posco International completed construction of its inaugural plant in Mexico last year. It is considering initiating construction of its second plant in Mexico and setting up a new facility in Poland within the first half of this year.

In the food production sector, the company unveiled its intention to enhance the stability of securing original produce through the formation of farming joint ventures in Australia and the United States.

Plans are underway to commence construction of a palm oil refinery in Indonesia in collaboration with GS Caltex Corp. in the first half of the year. Palm oil, known for its greatest production per unit area among vegetable oils, is used in various sectors, including food, cosmetics and bioenergy.

Posco International achieved a milestone of 1 trillion won in operating profit last year for the first time, surging 28.9 percent, according to the company's earnings announcement. The company also reported annual sales of some 33 trillion won, with net profit amounting to 680.4 billion won.

By Kim Hae-yeon(hykim@heraldcorp.com)