POSCO to supply HIC steel for Aramco's Fadhili expansion, marking its debut and boosting South Korea’s industrial role globally.
POSCO Holdings revealed on July 14 that it will be supplying hydrogen-induced cracking (HIC) resistant steel for the expansion of Saudi Aramco’s Fadhili gas plant. This marks a significant milestone as it is the first time POSCO will be delivering HIC-certified steel to an Aramco facility. The Fadhili gas plant expansion is a major undertaking by Aramco, the state-owned oil giant of Saudi Arabia, aimed at boosting the plant’s capacity by nearly 60%.
HIC-resistant steel, such as the one POSCO is providing, is a specialized material used in oil and gas operations. It is specifically designed to withstand hydrogen-induced cracking, a common issue in energy infrastructure where hydrogen atoms cause internal damage to steel over time. These steels are particularly crucial for use in severe environments like pipelines and pressure vessels, where material integrity is critical for safe and efficient operations.
Traditionally, Aramco has relied solely on European steelmakers to supply this highly specialized HIC-certified steel. These suppliers were selected based on their ability to meet rigorous HIC testing and quality standards that go beyond international benchmarks such as the NACE TM0284 standard. To date, only nine steel producers globally, including POSCO, have been certified to meet Aramco’s elevated requirements.
POSCO's successful certification and subsequent contract with Aramco not only signal a breakthrough into a previously exclusive supplier group but also strengthen the company's position in the high-value steel segment catering to the global energy industry. The company believes that this project will serve as a stepping stone for further growth and influence in supplying premium-grade steel for critical infrastructure.
Interestingly, prior to POSCO’s involvement, European manufacturers were slated to supply the necessary materials for the Fadhili project. However, with POSCO now confirmed as the steel provider, the associated manufacturing contracts for piping and pressure vessels have been awarded to South Korean companies. This marks a significant shift, showcasing how upstream advancements in steel quality and certification can stimulate downstream industrial competitiveness and reshape project supply chains.
Now, key South Korean firms are playing pivotal roles in the project. Hyundai Steel Pipe and SeAH Steel are producing the piping systems, while Bumhan Mecatec is handling the pressure vessel components. Additionally, TAE KWANG CORPORATION is responsible for manufacturing the necessary fittings. This collaboration highlights the technological capability and growing global competitiveness of South Korea’s steel and fabrication industries, positioning them as reliable partners in high-stakes international energy projects.
