POSCO Hydrogen-Based DRI Plant Approved in Pohang: Pilot Project to Launch by 2028

POSCO Hydrogen-Based DRI Plant Approved: Key Project Details

South Korea has approved the site for POSCO’s hydrogen-based steel project in Pohang. The plan transforms 1.34 million square meters of reclaimed coastal land into a dedicated industrial zone. Authorities amended the Pohang National Industrial Complex plan to accommodate this project, integrating metallurgical and energy infrastructure.

POSCO will develop the HyREX pilot facility at this site, producing molten pig iron by reducing fine iron ore with hydrogen. The pilot plant is expected to have an annual capacity of 300,000 tons and will launch by 2028. The project timeline for the full industrial complex has been extended from 2030 to 2041, reflecting its long-term strategic nature.

The approval followed a complex administrative process that began in 2023, including environmental assessments and multi-ministry consultations. POSCO has pledged to use stabilized materials during land reclamation to limit environmental impacts, addressing concerns raised by local residents and environmental groups.

Hydrogen Steel Production Challenges and Opportunities

Hydrogen-based steel production represents a crucial step toward decarbonization in South Korea. By replacing carbon with hydrogen, POSCO aims to significantly reduce CO₂ emissions. However, the project faces challenges in securing a stable hydrogen supply and accessing low-carbon electricity.

The Pohang facility complements POSCO’s broader modernization efforts. For instance, the company is set to launch a 2.5 million-ton electric arc furnace at its Gwangyang plant in June 2026. This investment highlights POSCO’s commitment to combining hydrogen-based technology with advanced electric arc furnace production.

Meanwhile, hydrogen steel initiatives worldwide, such as those in Europe, show that infrastructure development, regulatory approval, and environmental compliance are critical success factors. POSCO’s Pohang pilot plant could serve as a benchmark for Asian hydrogen steel projects.

SuperMetalPrice Commentary:

POSCO’s hydrogen-based DRI plant approval marks a milestone in clean steel innovation. The Pohang HyREX pilot demonstrates how traditional steelmakers are transitioning toward low-carbon operations. Success will depend on hydrogen supply security, electricity decarbonization, and careful environmental management. Industry watchers should monitor POSCO closely, as the project could influence both regional hydrogen adoption and global green steel strategies.