MHI Receives Order from Korea for 2 Sets of GTCC Power Generation System
To Fire By-product Gas from Iron-making Furnaces at POSCO Pohang Works
-- Collective Power Generation Capacity of 290 MW --

The GTCC plants on order will use by-product gases from furnaces - specifically, FINEX gas, blast-furnace gas and coke-oven gas - as fuel. The FINEX furnace is POSCO's proprietary direct reduction furnace that enables a more simplified iron-making process than using a blast furnace*. POSCO is currently planning the addition of a new FINEX furnace as well as expansion of its existing FINEX demonstration plant and blast furnace; the company will utilize the by-product gases from these furnaces for power generation to meet part of its own electricity needs.

The power plants will be operated by POSCO Power. MHI will be responsible for the design and manufacture of the gas turbines, steam turbines, gas compressors and electrostatic precipitators (dust collectors) - the core equipment of the power generation facility - as well as peripheral equipment. Mitsubishi Electric Corporation will supply the generators and Mitsubishi Corporation will handle the trade particulars.

Earlier, in 2005 MHI received an order from POSCO for a 146 MW FINEX gas-fired GTCC plant for the Pohang Works; this was followed by an order in 2008 for two blast-furnace-gas (BFG) fired GTCC plants for the company's Gwangyang Works. All three power plants have already gone into operation.

Because by-product gases of iron works have a lower calorie heating value than natural gas, which is widely used for GTCC power generation, stable operation of by-product-gas fired gas turbines requires advanced combustion technology. MHI established its proprietary BFG-GTCC power generation technology in the 1980s, including the development of dedicated BFG combustors. The company has an abundant track record in the delivery and operation of by-product-gas GTCC plants throughout the world and currently enjoys approximately 60% share of the global market. MHI believes this track record and its technological lead contributed greatly to the company's winning of the new order from POSCO, in combination with full marks given to the outstanding reliability, efficiency and economy of MHI equipment.

As global demand for steel continues to expand amid the rapid economic growth of emerging nations, steelmakers worldwide are focusing on enhancement of their production facilities and related efficiency. At the same time, all companies are keen to save energy and lighten environmental burdens in the iron-making process. Going forward MHI intends to further strengthen its by-product-gas fired GTCC power plant marketing activities as the technology and solution to satisfy these needs.

Note: The FINEX process requires neither coking of coal nor sintering of iron ore. It is expected to enable reductions in facility investment and production costs, including raw material costs, compared with conventional blast furnace processes.