POSCO, The Pohang Iron and Steel Company, (KRX: 005490) (NYSE: PKX) (TYO: 5412 ) (LSE: PIDD), based in Pohang, South Korea, is taking on African partners to help push forth its development of natural resources in the region.
The company is the world's second largest steel maker by market value. It has resolved to double its raw material self sufficiency to 50% by the year 2014.
In preparation for this it has come to an agreement with Vale, the Brazilian mining company to jointly develop a coal mine in Mozambique. The coal mine is situated in Tete and should produce 11 million tonnes of coal on a yearly basis which would be used for power generation as per POSCO.
The South Korean company is also hoping to develop an iron ore project in Mbalam with Cameroon. This will produce 35 million tonnes of iron starting in 2014. Iron being the basic raw material that the steel making company needs.
POSCO has also signed a memorandum of understanding with Anchor in Zimbabwe to develop another joint venture project to develop chrome, coal and other raw materials. In the Democratic Republic of Congo the steel maker is considering developing a copper mine jointly and also helping to build hydropower plants.
The chief executive of POSCO, Chung Joon-yang said that the agreements with the four African countries would help the Pohang, North Gyeongsang Province-based steelmaker to become more self sufficient in its raw material demands.