posco AMERICA

- Chairman Joon-yang Chung signs agreement for resource development in Chile, Honduras, etc.

Chairman Joon-yang Chung visited Chile, Honduras, and Ecuador of South America from May 4th to 10th and discussed resource development, infrastructure construction projects, etc., expanding business opportunities in these regions.

On the 7th, Chairman Chung signed an MOU with Peru`s Li3 Energy, which is leading a lithium development project in Chile, on joint technological and investment cooperation for production and commercialization of lithium applying Research Institute of Industrial Science & Technology (RIST)`s technology.

With this MOU, POSCO`s RIST will start construction of a commercialized plant in Chile once it succeeds in a pilot plant for lithium extraction, and POSCO plans to acquire a share of Li3 Energy by the end of August after due diligence.

Li3 Energy is a natural resource development company with a 60% share of the salt lake of Maricunga in Atacama, Chile. The salt lake of Maricunga`s carbon lithium is estimated to be approximately 1.2 million tons, and once drilling starts in the second half of the year, lithium is expected to be produced as early as 2013.

Lithium is the lightest of all metallic elements and has the advantage of more stably providing charged electricity compared to other materials. Lithium consumption is increasing each year being the core material in batteries for mobile devices such as cellular phones and electric cars. The 100,000 ton global lithium consumption last year is forecasted to increase five-fold and reach 2 million tons yearly in 2050.

To transform itself into a comprehensive material corporation, POSCO is placing its efforts in developing lithium extraction technology and securing lithium salt lakes. This past February, POSCO signed an MOU on sea water dissolved lithium extraction technology with the Ministry of Land, Transport and Maritime Affairs and Korea Institute of Geoscience and Mineral Resources (KIGAM), completed an R&D facility in April and is currently conducting research on lithium extraction. In addition, POSCO is participating in the Bolivia salt water mine lithium extraction project with the Korea Resources Corporation.

Prior to this, Chairman Chung met with President Porfirio Lobo Sosa of Honduras on May 4th and signed an MOU for joint cooperation in the country`s infrastructure and city construction project investments.
Honduras is proactively establishing infrastructure for advancement and industry diversification of various fields including water power generation, renewable energy and road construction, and hopes for the participation of POSCO in the economic development special zone and mineral resource development. This means a bright outlook for POSCO family companies.

On the 5th, Chairman Chung visited Ecuador, holding a POSCO family inauguration ceremony of Santos CMI, a plant design and construction company.

Santos CMI was acquired by POSCO E&C and Daewoo Engineering with a 70% share jointly this past February. With more than 25 years of expert construction experience, this company specializes in electricity generation, oil gas, engineering works and industrial fields and has successfully carried out more than 130 projects in 18 countries throughout the Middle and South America regions.

Sangwook Oh sangwook@posco.com
(Data=Future Strategy Group, Material Business Division)

- Chairman Joon-yang Chung is shaking hands with Honduras President Porfirio Lobo Sosa after signing an agreement for joint cooperation in infrastructure construction, resource development, etc. Chairman Chung also visited Ecuador and Chile, expanding business opportunities in the South America region.