POSCO Holdings to set up factory for rare gas production

POSCO Holdings will build a production facility for rare gases used in manufacturing chips, displays and other cutting-edge tech products, in a move to localize production, the Korean steelmaker said Wednesday.

According to POSCO, the company will begin construction in 2024 and plans to complete the plant by the end of 2025 by teaming up with Zhongtai Cryogenic Technology which specializes in manufacturing cryogenic equipment.

The factory comes with a rare gas production capacity of 130,000 normal cubic meters annually, POSCO said. This amounts to 52 percent of rare gas demand for local chipmaking. The facility will be located in the nation’s southern city of Gwangyang.

Starting from January last year, POSCO has produced crude neon gas. The company will expand the gas production lineup to crude xenon and crude krypton in 2024.

POSCO will secure a 75.1-percent stake in the joint factory, and the Chinese firm will obtain the remainder.

Korean tech firms have so far resorted to importing rare gases due to a lack of production equipment. Major importing countries included the United States, China and Ukraine, but in recent years calls have grown for the need to localize production here amid growing uncertainties and bottlenecks in global supply chains.

The plant will help reduce such risks by helping stabilize domestic supply of rare gases used for the aforementioned key export items.

Zhongtai Cryogenic Technology will supply equipment and technologies for producing crude rare gases.

“We will be able to help stabilize the supply of rare gases used for manufacturing chips, and alleviate tech firms’ burdens stemming from their imports,” a spokesman at POSCO Holdings said. “In particular, our new investment was made possible, as the government made swift decisions on deregulation.”