CONTENTS · Dec 1980 Acquired the German TUV QA certification Jun 1982 Re-named Sammi Specialty Steel Co., Ltd. Oct 1986 Obtained Japanese Industrial Standards (JIS) accreditation

CONTENTS

1. Company Introduction 4 ~ 5

2. History 6 ~ 7

3. Ethical Management 8

4. Eco-Friendly Management 9

5. Research & Development 10 ~ 11

6. Products 12 ~ 19

7. Manufacturing Process 20 ~ 31

8. Quality Assurance/ 32 ~ 33

Certificates of Approval

9. Key Management Status 34

10. Global Network 35

At POSCO Specialty Steel, we put people and the environment first.

We are dedicated to contributing to Korea’s industrial advancementthrough green growth, and delivering highest-quality products and services to our customers as we promote open-mindedness and creativity.

Upo Wetland

Company Introduction

Founded in 1997 as a subsidiary of POSCO, POSCO Specialty Steel

has been committed to becoming the best specialty steel makers in

the world. With an annual production capacity of 1,200,000 tons of crude

steel, the company produces specialty wire rods, round bars, flat bars,

forged square bars, seamless pipes and tubes, and forgings that

are recognized world-wide for their outstanding quality.

To ensure continued technological development and manufacturing of products

with high added-value, the company successfully completed its 1st facility revamping

investment project (AOD, HV-mill, SRM, DST, new pickling process, large scale ingot

casting and forging factory) and the 2nd facility revamping investment project (60-ton

electric arc furnace, vertical large-section continuous bloom caster and SBM) helping

the company secure its future growth engine. In addition, POSCO SS is expanding

its business scope by breaking ground on POSCO SS-VINA steel mill in Vietnam

and opening new offices in China, Thailand and Japan to facilitate transformation

into a true, first-tier global presence in the steel industry.

We strongly believe in ethical management, eco-friendly management implementation,

volunteering for our community and win-win cooperation strategies with small

and medium-size enterprises. We take our responsibilities as a corporate citizen

very seriously as we envision our growth in tandem with that of the community.

POSCO Specialty Steel is the leader of the 21st century specialty steel industry with high-quality

products and services, customer loyalty, and dependability. Our spirit of challenge pushes

us to work hard to create a better, more hopeful future.

Open Management

CreativeManagement

Eco-friendlyManagement

Customer Challenge Execution People Integrity

Create the Best Specialty Steel 04 l 05

1966

Apr 1966

Founded Samyang

Specialty Steel Co., Ltd.

1970s

Oct 1975 Re-named Korea Specialty Steel Co., Ltd.

Dec 1977 Completed Korea Specialty Steel

Changwon factory

Jun 1978 Obtained KS quality accreditation

1980s

Dec 1980 Acquired the German TUV QA certification

Jun 1982 Re-named Sammi Specialty Steel Co., Ltd.

Oct 1986 Obtained Japanese Industrial

Standards (JIS) accreditation

1990s

Mar 1993 Acquired ISO 9002 certification

Jan 1996 Signed specialty steel manufacturing

technology transfer agreement with Egypt

Feb 1997 Re-named Changwon Specialty Steel Co., Ltd.

(a POSCO subsidiary)

2000s

Feb 2000 Became the local steel industry’s first company

to introduce 6-sigma system

Dec 2000 Obtained ISO 14001 certification

Jun 2004 Received National Eco-friendly Management Award

(Grand Prize in the clean manufacturing division)

Oct 2006 Completed the 1st stage of the facility rationalization project

(AOD, HV-Mill, RSM, DST, new pickling process,

large scale ingot casting factory)

Feb 2007 Re-named POSCO Specialty Steel Co., Ltd. (changed CI)

Nov 2007 Completed massive forging factory (9000 tons)

Jul 2008 Opened China office

Oct 2008 Opened Thai office

Won grand prize in eco-friendly management

Nov 2009 Completed new corporate building (Seoul office)

(POSCO SS&CC TOWER)

Jun 2010 Opened Japan office

Aug 2011 Obtained ASME(The American Society of Mechanical

Engineers) certification

Apr 2012 Completed the 2nd stage of the facility rationalization project

- New steelmaking construction (60-ton arc furnace,

vertical large-section continuous bloom caster)

- SBM/furnace for rolling factory

Jun 2012 Broke ground POSCO SS-VINA steel mill in Vietnam

Company’s founding ceremonyGround-breaking ceremony for the 1st stage of the facility rationalization project

Ground-breaking ceremony for the 2nd stage ofthe facility rationalization project Changed POSCO Specialty Steel CI Won grand prize for eco-friendly management New Seoul office (POSCO SS&CC TOWER)


HISTORY

Ethical Management

POSCO Specialty Steel introduced its code of ethics in 2003, setting the standard for ethical conduct

of its employees. By offering various training programs, the company does its best to make sure ethical

management represents the ethos of its corporate culture. Operating an independent ethics

implementation program for each division also helps the company root out ethical risks and refines

its ethical management style.

Eco-Friendly Management

At POSCO SS,we implement low-carbon green-growth policies.

Putting the environment before anything else, we continue to dedicate ourselves to improve the health

of our community members and the future of our planet currently endangered by environmental threats.

Acquired ISO 14001 environmental management systems accreditation (2000)

Provided TMS (Tele-metering system) based monitoring system in real-time (2003)

Successfully eliminated pollutants and ensured eco-friendly manufacturing

technology by localizing the nitric -free acid pickling process (2008)

Constructed cutting-edge facilities to recycle byproducts to be used as a resource (2008)

- Slag treatment facilities to improve collecting metallic residues in slag and recycle

slag to use as resources

- Effluent recycling facilities to utilize waste water as resources (540,000m3 per year)

Mentoring enterprises in city of Changwon about corporate environmental

management (2009~)

Established ‘Green-management Information System’ to manage and share energy,

environmental information (2012)

Implementation of environmental protection initiatives

Voluntary agreement to reduce discharge of accumulated organic pollutants

(2005, Ministry of Environment)

Voluntary agreement to save energy and reduce discharge of greenhouse gases

(2006, South Gyeongsang Province)

Voluntary agreement to respond to climate changes and reduce discharge

of greenhouse gases (2007, City of Changwon)

Voluntary agreement to ensure green-friendly procurement

(2007, 2010, Ministry of Environment)

Signed MOU for recycling treatment by collecting Ni up in byproduct

(2008, Research Institute of Industrial Science & Technology)

Recycling treatment by collecting Zn up in dust of Steelmaking process (2009, Zincox)

Active responses to environmental regulations

Designated outstanding green-energy company (2003, Korea Times)

Won national grand prize in eco-friendly management

(2004, Ministry of Commerce, Industry and Energy)

Received grand prize in eco-friendly management (2008, City of Changwon)

Won silver prize in Korea environmental-technology (2011, Union of Korea Environmental-technology)

Received grand prize in POSCO Family green-management (2011, POSCO)

Recognitions of the company’s efforts to protect the environment

Received the best grade ‘AA’ in 2009 from the Fair Trade Commission’s Compliance Program Rating.

Independent fair-trading compliance program

An internally-regulated compliance system geared to help prevent violation of the Monopoly Regulation and Fair Trade Act,. introduced as of April 1, 2003.

Continuous ethical training

- Mandatory cyber training courses- Continuous case studies to help

prevent risks

Independent ethics implementationprogram for each division

Help identify ethical risks by practicingself-appraisal and debate for each ethical implementation item

Operation of online hotline(counseling center)

Operation of ethical/fair trade website(http://ethics.poscoss.co.kr)

Systematic ethics implementation

programs

Slag treatment facilities (Completed in 2008, invested 17.2 billion won)



Research & Development

Strengthening R&D capability of new products and processesthrough selection and concentration

We are growing as one of the top specialty steel makers by focusing on new technologies and products.

Maximizing synergistic research effects through R&D networks of POSCO family

POSCO Specialty Steel focuses on developing new products and process technologies to ensure synergistic effects

through R&D networks of POSCO Family (POSCO Technical Research Laboratories, Research Institute of Industrial

Science & Technology, POSTECH, etc.) and we are accomplishing effective R&D programs through industry-academia

-institute partnerships.

Technological development accomplishments

POSCO Technical Research Laboratories

POSTECH

Research labs &universities

Research Institute of Industrial

Science & Technology

POSCO Specialty Steel Technical

Research Institute

Super & lean duplex STS for offshore plant

Large size forged product for ITER(InternationalThermonuclear Experimental Reactor) shield block /Precised tube for super-conductor jacket

Heat resistance gas turbine material for combinedcycle power plant

Austenitic heat resisting steel tube for high efficiencycoal-fired power boiler

Plastic injection mold steel with excellent mirror-polishability

High-corrosion resistance ferritic STS for automotiveexhaust part

Development of new products

Large ingot continuous caster(LICC)

Continuous casting techniques for high alloy steelusing Vertical Continuous Caster(VCC)

Square ingot for direct-rolling

Steelmaking techniques for high cleanliness ofautomotive material

Development of new processing techniques

Human resources development programs to strengthen researcher R&D capability

POSCO SS collaborates with several universities to enhance R&D competency through customized masters and

PhD courses. We also participate in various academic conferences and publish research results.

ProductsWire Rods 14

Round Bars 15

Flat Bars and 16

Square Bars

Forged Products 17

Seamless Pipes 18

and Tubes

Special Alloy 19

and Military Materials

Billets and Ingots

1. Wire Rods

Wire rods are widely used in the industry to make a variety of products, including springs, bolts

and nuts, wire ropes, mesh, drawn bars, and reinforced bars for construction projects.

We manufacture stainless steels, carbon-alloys, and special alloy rods and have the world’s top

production capacity for stainless steel wire rods, with an annual production capacity of 180000 tons.

Applications

2. Round Bars

Round bars are the core industrial materials for automobile parts, turbine blades for power plants,

ship-building shafts, precision machines, etc. Various heat treatments and surface processing

technology are offered to produce custom-tailored products.

Applications

Springs Bolts and nuts

Bellows Precision shafts

Wire ropes Automobile transmission parts Gears for industrial machines

Automobile parts forging punches

Semiconductor and vacuum facility parts

Engine valves

Production range(unit: mm)

Dimension : 5.0 - 34Ø

Unit weight : Max. 1.6 tons

Surface condition : As rolled,

pickled



Dimension

As rolled : 13 - 350Ø (rolled product)

As forged : 215 - 1,600Ø

Peeled : 8 - 1,600Ø (rolled products)

Centerless ground : 6 - 80Ø

Cold drawn : 6 - 30Ø

Length : Max. 12,000L (rolled)

Max. 15,000L (forged)


3. Flat Bars and Square Bars

Used for industrial products requiring high strength and excellent wear resistance;

such as press molds, extrusion dies, knives, etc. The company supplies high-quality products

manufactured at state- of- the- art flat rolling and forging facilities.

Applications

4. Forged Products

POSCO SS’s outstanding forging techniques are the key for manufacturing various types of products,

including marine engine parts and shipbuilding materials and shells. New product development

and quality enhancement are also emphasized to keep up with customer demands favoring higher

levels of sophistication and dimension.

Applications

Press molding plates

Automobile bumper molds

Shear knives

Crank shaft parts

Propeller shaftsIntermediate shafts

Vessel name: MARILOULA (DSME Co., Ltd.) (British Naval Architect-designated outstanding vessel of 2008)

Featuring POSCO SS’s cutting-edge shipbuilding materials


Rolled products: 10 - 150T X 150 - 1,050W

Forged products

Tool steel: 151 - 700T X 200 - 1,250W

Mold steel: 200 - 1,100T X 500 - 1,900W


Type

Shafts

Disks

Shells

Rolls

Engine parts

Diameter (Ø)

350 - 2,200

1000 - 3,800

Max. 3,900

Work Roll (~ 650Ø), Back-up Roll ( ~1,400Ø)

Max. 98MC (MAN diesel type)

Length (L)

Max. 15,000

Min. 200

Max. 3,800

Weight (ton)

Max. 98

Max. 98

Max. 98

5. Seamless Pipes and Tubes

At POSCO SS, seamless pipes and tubes are manufactured by Korea’s unique extrusion techniques

unlike other welded steel pipes. The products are used in various applications demanding

super-high temperature, high pressure, and ultra-clean environment, such as power generation,

petrochemical plants, shipbuilding, and semiconductor manufacturing.

Applications

Power plant boiler tubes

Shipbuilding and marine engineering plant pipes

Petrochemical heat exchanger tubes Semiconductor precision steel pipes and tubes


Dimension

Hot finished Cold finished

External 42 - 140Ø 10 - 114Ø

diameter

Thickness 3 - 30T 1 - 16T

Length : Max. 25,000L

6. Special Alloy and Military Materials

Special alloy and military materials must be high-functioning and ultra-clean.

At POSCO SS, we are equipped with outstanding internal quality control systems based on vacuum

induction dissolution and a special refining process. Our products include state-of-the-art items such

as power plant turbine blades, parts with ultra- corrosion and heat resistance, and parts to be used

in the defense and aerospace industries.

7. Billets and Ingots

Billets and ingots are manufactured via the ultra-clean refining process and are used for our clients’ rolled

and forged product materials.

Ultra heat-resistant alloy for gas turbine blades

Special alloy for high-voltagepower line cores (INVAR)

Tank & gun tube materials Ammunition materials

Dimension(mm)

Length(mm)

Shape

200, 150Ø

Max. 12,000L

Round

Continuous Cast Billets

160, 150, 130SQ

Max. 12,000L

Square

Rolled Billets

70~200SQ

Max. 8,000L

Square

Ingots

Max.150 ton

-

Corrugate


Manufacturing processManufacturing 22 ~ 23

process

Steelmaking 24 ~ 25

Rolling 26 ~ 27

Forging 28 ~ 29

Seamless piping 30 ~ 31

and tubing

100 ton AOD

Manufacturing Process

Major Facilities

Scrap & alloy ferrous metals

Electric arc furnace

Vacuum Induction Melting(VIM)

Argon oxygen decarburization (AOD)

Vacuum refining facility (VD/VOD)

Ladle furnace(LF)

Electrode Slag Remelting(ESR)

Continuous billet caster

Continuous bloom caster

Billet

Bloom

Rolling facility

Forging facility

Drawing / PilgeringSeamless Pipes and Tubes

Forged Materials

Rolled Flat Bars and Forged Square Bars

Bars

Wire Rods

Ingot

Ingot casting

Radiological pollution tests

Scraps Steelmaking Refining

VIM ESRContinuous billet caster

Continuous bloom caster

Ingot casting

Rolling Forging

Extrusion


Process Facility

Electric arc furnace (2 units) : 100 tons, 60 tonsVacuum induction melting furnace (1 unit) : 2 tons

LF (2 units) : 100 tons, 60 tonsVD (1 unit) : 100 tons, VD/VOD (1 unit) : 60 tons AOD (1 unit) : 100 tons ESR (2 units) : 30 tons, 5 tons

Continuous billet casterContinuous bloom casterIngot casting facility (ingots weighing 4 - 150 tons)

Materials and small bar rolling machines- Wire Rods : 5.0 - 34Ø - Bars : 13 - 80ØBreak down mill and flat steel, large section bar steel rolling mill (H-V type)- Flat bars (mm) : 10 - 150T X 150 - 1,050W - Bars : 85 - 350Ø

Press (2 units) : 9,000 tons, 1,800 tons

Extrusion press (1 unit) : 2,000 tonsPilger mill (7 units) : 75VMR (2 units), 25VMR (1 unit), HPT 30-60 (4 units) Drawing facility (3 units) : 40 tons (1 unit), 20 tons (2 units)

Heat treatment furnace, Straightener, Peeling machine, Inspection Pickling facility

Steelmaking

Melting

Refining

Casting

Rolling

Forging

Seamless steel piping and tubing

Finishing process

Extrusion facility

Steelmaking

100-ton electric arc furnace

Steelmaking Process

The steelmaking process is a crucial process that determines the quality of specialty steel products and consists

of the melting, refining, and casting process. Melting facilities include 100-ton/60-ton electric arc furnaces and VIM

(Vacuum Induction Melting) for ultra-clean manufacturing. For the refining process, secondary refining processes

such as LF, VD, VOD and AOD are available and ultra-clean, high-functioning parts materials are manufactured

by the ESR process which is a special refining technique.

60-ton electric arc furnace VD ESR

Casting Process

The casting process is divided into continuous casting and ingot casting, allowing the production of semi-finished items

such as billets, blooms, and ingots. Billets are manufactured in curved continuous caster and the largest-section

blooms in the world are manufactured for the production of high-quality, ultra-clean steel.

We are also able to manufacture ingots weighing from 4 tons up to 150 tons, depending on specific customer demand.

Continuous billet casting Ingot casting


Rolling

SBM

Kocks Mill

Wire rods rolling process

POSCO Specialty Steel produces wire rods and round bars with outstanding quality through the continuous rollling

process consisting of the roughing mill, intermediate mill, and finishing mill. The 3-roll based kocks mill ensures

consistent surface and core rolling. The cutting-edge RSM (reducing and sizing mill) enables homogeneous micro

structures and less-than-0.1mm accurate dimension control via high-speed precision rolling.

Our cutting-edge DST (direct solution treatment) technique ensures consistent control of grain size and strength.

The nitric acid-free acid pickling process, a state-of-the-art eco-friendly pickling technique, allows us to produce

stainless steel wire rods with top surface quality.

RSM Laying Head

Flat bar and round bar rolling process

Flat bars and round bars are manufactured via forging and blooming or large section rolling processes.

The newest SBM block mill is able to produce large section rolling bars and wide range flat bars.

HV-Mill allows the production of flat bars and round bars of precise dimension, based on our horizontal-vertical

continuous rolling techniques.

Flat Block Mill Compact Cassette Rolling Mill

DST Acid pickling


Forging

9,000-ton press

In the forging process, steel ingots are heated and forged into various shapes such as marine shafts,

engine parts, plant shells and discs, bars, and plates.

After forging, forgings are heat treated to meet the mechanical requirements. Visual inspection,

UT (ultrasonic testing), and witness inspection by third parties are performed for quality assurance of the products.

9000-ton press/manipulator

Heat treatment Testing

Band Saw


Seamless pipes and tubes

2,000-ton extrusion press

The manufacturing of seamless tubes and pipes is started by cutting peeled round bars in the band sawing machine

into designed lengths based on product size. After then, bars are moved to the boring machine to make a center hole

for extrusion. After boring, the bars are heated in the induction heater, and extruded by a 2000 ton press into designed

sizes of tubes and pipes.

Extruded tubes and pipes are heat treated, straightened and pickled to become hot finished products, while additional

pilgering or heat treating and pickling is added to produce excellent cold finished products with high size precision.

Every piece of product is inspected by an in-line nondestructive testing machine to ensure the internal and surface quality,

and provided to customers as products with perfect quality.

Band Saw

Boring M/C Billet-loading robots

Pilger mill(75VMR) Testing

Cooling Bed


To ensure top-quality products that suit the application and processing conditions specified by our customers, we use cutting-edge inspection equipments

and apparatuses and operate error-proof quality testing systems.

Medium-size round bar non-destructive tester/TOM

Small- size round bar non-destructive tester/NDT

Small peeled round bar non-destructive tester/ECT&UT

Seamless pipes & tubes line UT tester

Seamless pipes & tubes non-destructive tester Large forged-product UT tester

At POSCO Specialty Steel, we use up to 115 various analyzing equipment to perform analysis on chemical

composition, mechanical properties, and microscopic tests to meet the level of quality our customers demand.

Certificates of Approval

Chemical composition analyzer Gas analyzer Tensile tester

Hardness tester Impact testerScanning Electron

Microscope(SEM/EDS)

Quality Assurance

ISO 9001 Quality management systems ISO/TS 16949 Quality management systems

-Particular requirements for the application of ISO 9001:2000 for automotive production and relevant service part organizations

ISO 14001 Environmental management sytems

KOSHA 18001 Occupational Safety and Health Management Systems

Korean Industrial Standards

AD-2000 Merkblatt W0European Directive 97/23/EC (PED)

Japanese Industrial Standards

Korea Electric Power Industry Code

The American Society of Mechanical Engineers

Korean Register of shipping(Korea)

American Bureau of Shipping (USA)

Lloyd’s Register (UK)

Det Norske Veritas (Norway)

Bureau Veritas (France)

Germanischer Lloyd (Germany)

Registro Italiano Navale (Italy)

China Classification Society (China)

Nippon Kaiji kyokai (Japan)


KoreanOffices

OverseasOffices

Headquarters 147 Jeokhyeon-Ro, Seongsan-Gu, Changwon, Gyeongsangnam-Do, Republic of Korea

Tel 82-55-269-6114 Fax 82-55-269-6901

Seoul Office 479 Kangnamdae-Ro, Seocho-Gu, Seoul, Republic of Korea

Tel 82-2-3469-6665 Fax 82-2-3469-6888

POSCO SS-VINA N1 Street, Phy My 2 Industrial Zone, Tan Yhanh District, BRVT Province, Vietnam

Tel 84-64-3892-009 Fax 84-64-3892-300

POSCO Specialty Steel China Rm.2804(B), B Dawning Center, No. 500 Hongbaoshi Rd., Shanghai, 201103 China

Tel 86-21-6091-3688(101) Fax 86-21-6091-2645

POSCO Specialty Steel Thailand 399 Interchange 21 BLDG, 22F, 21R Sukhumvit RD, Klongtoey-Nua, Wattana, Bangkok, 10110, Thailand

Tel 66-2-259-0371 Fax 66-2-259-0372

POSCO Specialty Steel Japan POSCO OSAKA BLDG. 9F. 3-7,2-Chome Namba.Chuo-Ku,Osaka 542-0076 Japan

Tel 81-6-6214-0750 Fax 81-6-6214-0751

VSC-POSCO STEEL CORPORATION Hong Bang, Haiphong, Vietnam

Tel 84-31-385-0067 Fax 84-31-385-0123

Major Contacts

Contact Information (by operation)

Product

Marketing Division

QA Technology

Technical Research Laboratories

Stainless steels

82-2-3469-6664

82-55-269-6254

Carbon-alloysteels

82-2-3469-6611

82-55-269-6227

82-55-269-6653

Tool steels

82-2-3469-6609

82-55-269-6255

Free-forged steels

82-2-3469-6691

82-55-269-6224

Semi-finishedproducts

82-2-3469-6839

82-55-269-6227

Seamless Pipe and Tube 82-2-3469-6863

82-55-269-6526

Global Network

Local Offices

Overseas Offices

Major Clients(countries)

Key Management Status

Crude steel production (unit : 1000 tons)

Sales volume (unit : 1000 tons)

General Status

Established : February 14, 1997

Headquarters : 147 Jeokhyeon-Ro, Seongsan-Gu, Changwon, Gyeongsangnam-Do, Republic of Korea

Shareholders : POSCO (100 percent)

CEO : Hyun-uk Sung

No.of employees : 1,238(As of December 31, 2011)

Summary of Financial Information

Sales

Operation income

Net income

Assets

Liabilities

Shareholder s equity

(Capital stock)

07

1,347

77

52

921

495

426

(113)

08

1,456

105

67

874

382

491

(113)

09

1,102

68

56

843

297

546

(113)

10

1,338

127

101

1,099

458

642

(113)

11

1,442

140

111

1,372

600

773

(113)

(Unit : Mill U$)

Documents

CONTENTS · Dec 1980 Acquired the German TUV QA certification Jun 1982 Re-named Sammi Specialty Steel Co., Ltd. Oct 1986 Obtained Japanese Industrial Standards (JIS) accreditation