POSCO SNNC, a leading manufacturer of ferronickel, has completed the construction of its second electric furnace, which will help nearly double the firm’s annual capacity of pure nickel to 54,000 tons from the current 30,000 tons.

The POSCO affiliate said it invested about 480.6 billion won ($437.1 million) to build the second facility in Gwangyang, South Jeolla Province, to stabilize its nickel production.

“With our increase in production capacity, POSCO SNNC has become a nickel smelter that is comparable to any other global competitor,” POSCO chairman Kwon Oh-joon said during a building completion ceremony on Friday.

“The SNNC will not only contribute greatly to New Caledonia and South Korea’s national interest, but also become a crucial growth engine for the SMSP and POSCO’s stainless businesses,” he added.
 

Paul Naoutyine, president of New Caledonia’s northern province who also joined the event, said the nickel project was “a business that could not have been done without the trust, and cooperation between POSCO, SMSP, SNNC and New Caledonia’s Nickel Mining Company.”

The SNNC is a supplier of ferronickel, which is one of the main raw materials of stainless steel production process. The company’s first electric furnace with annual capacity of 30,000 ton was built in 2008.

The SNNC is jointly owned by Korean steel maker POSCO, the world’s fourth-largest steel producer, and New Caledonian mining firm SMSP.

The joint venture, with 49 percent ownership by POSCO and 51 percent by SMSP, was made to secure a stable supply of nickel, which takes up as much as 80 percent of stainless steel’s production.

By Suk Gee-hyun (monicasuk@heraldcorp.com)