posco AMERICA

POSCO registered the CDM (Clean Development Mechanism) business with the United Nations Framework Convention on Climate Change (UNFCC) to earn carbon credits through the Uruguay local afforestation.

POSCO is the first domestic company to register afforestation carbon credit, 18th globally, and the first amongst steelmakers.

During the December 2008 Board of Directors Meeting, POSCO decided to invest 55 million USD in South America`s Uruguay to purchase 20,000ha of afforestation land to carry out the carbon credit project, to secure carbon credit while also improving the company`s environment friendly image. For this project, POSCO Uruguay was established in February of 2009.

POSCO Uruguay first purchased approximately 1000ha of land in August last year and planted approximately 880,000 Eucalyptus trees up to date as sample planting to check feasibility.

Prior to the UN CDM project registration, POSCO hosted a public hearing for stakeholders in Uruguay`s capital, Montevideo.

After receiving the Uruguay`s government approval this year, POSCO registered for the carbon credit project to the UNFCC.

Test planting results showed that Uruguay`s afforestation environment is excellent compared to other countries. There are approximately 4 million ha of afforestation encouragement land, while many afforestation specialized companies exist. Also, trees grew more than 2.5m after one year, showing excellent tree growth, and corporate and property taxes are exempted for afforestation companies.

With the excellent feasibility of affor(estation in Uruguay and by registering carbon credit to the UN, POSCO is planning to purchase an additional 19,000ha of land by 2013, expanding the total scale to 20,000ha.

This means the afforestation land equivalent to approximately one-third of Seoul will be secured, reducing 200,000 tons of carbon-dioxide per year.

Afforestation carbon credit projects are referred to as A/R (Afforestation/Reforestation) CD, which includes new afforestation or reforestation. POSCO has been actively promoting afforestation carbon credit projects as with the enactment of the Kyoto Protocol, 2005, Korea is also expected to mandatorily reduce greenhouse gases starting in 2013.

Conditions are very strict as the country`s permission must be received for regions that are not forests since 1990 to be recognized for afforestation carbon credit projects, followed by investigation by a UN assigned institution. The first afforestation project globally was secured in China`s Guang Xi Province in 2006, followed by 10 others in 2009, and 7 in 2010 including POSCO, growing in activities.
Ji-min Park dali@posco.com