POSCO Chemical and OCI officials, led by POSCO Chemical President Min Kyung-jun and OCI President Kim Taek-joong, pose after the two companied signed a deal to set up a joint-venture to produce high-purity hydrogen peroxide on Feb. 21. (Photos: OCI)

OCI Vice Chairman Lee Woo-hyun.

POSCO Chemical has agreed to set up a joint-venture to produce high-purity hydrogen peroxide with OCI.
OCI already produces hydrogen peroxide. POSCO Chemical, the refractory and secondary battery materials maker unit of POSCO, will supply the core material hydrogen peroxide to POSCO’s Gwangyang Steelworks.

POSCO Chemical and OCI signed a deal to establish a high-purity hydrogen peroxide joint-venture at OCI headquarters in Sogong-ro, Seoul, on Feb. 21. Hydrogen peroxide, an eco-friendly oxidizing agent, is in wide use as bleach and cleaning agents.

Hydrogen peroxide had proved to be effective in sterilization in efforts to combat the Middle East Respiratory Syndrome (MERS) and Severe Acute Respiratory Syndrome (SARS). Hydrogen peroxide is also used for sterilizing the COVID-19.

High purity hydrogen peroxide is used as an essential material to etch and clean in semiconductor and display production processes. POSCO Chemical will have a 51 percent stake in the joint-venture, to be established in the second quarter of the year while OCI will make an equity investment for a 49 percent share. Total paid-in capital is known to stand at about 100 billion won.

The joint venture will build a hydrogen peroxide production line with an annual production capacity of 50,000 tons on a lot covering 42,000 sq. meters at OCI’s plant in Gwangyang.

Hydrogen peroxide is produced using hydrogen extracted from coke oven gas (COG), a byproduct of the steel-making process. POSCO’s Gwangyang Steelworks will supply the core material, COG to the joint-venture.

Construction of the production line will begin this year and production will be launched in 2022.
Explaining the background of their collaboration, the two companies said the establishment of the joint venture is designed to stabilize the supply of the material essential for the Korean semiconductor process, given a market situation in which high-purity hydrogen peroxide demand is on the surge on the back of large-scale facility expansion by major semiconductor makers.

The two companies have implemented the joint venture project since they have shared similar interests.

POSCO Chemical has maxed out added-value of chemical products produced using by-products of steel-making process, while OCI will be able to secure high-quality raw materials in a stable and economical fashion.

The latter, which has been engaged in hydrogen peroxide business since 1979, will be able to further ramp up the business’s competitive edge and market standing.