South Korea`s metal giant Korea Zinc has entered into a strategic business alliance with Hanhwa Group to expand sourcing for renewable and hydrogen business, while ramping up copper foil capacity to drive new growth.

Korea Zinc disclosed last Friday that it will issue 470 billion won ($360 million) worth rights offering to Hanwha H2 Energy for a strategic partnership to target the renewable and hydrogen energy markets of the U.S. and Australia.

Korea Zinc also reported best-ever operating profit of 381.4 billion won during the April-June period.

Although the company’s mainstay business is smelting - the process of applying heat to produce a metal from its ore - the company has moved onto the so-called “Troika Drive” which aims to leverage its smelting knowhow on renewable and hydrogen, battery materials, and resource circulation businesses.

Korea Zinc’s Australian subsidiaries Ark Energy and Epuron are currently heading its renewable energy and hydrogen business. While Australia is a country that has an abundant supply of renewable energy, the Australian government announced its National Hydrogen Strategy in December 2018 which aims to position its hydrogen industry as a “major player” by 2030 to offset the instability of renewable energy.

Korea Zinc has decided to work with Hanwha to speed up the process of bringing the green hydrogen and ammonia produced in Australia to Korea. Since 97 percent of Korea’s energy relies on imports, securing energy sources is essential for energy security.

Hanwha Group is already pursuing renewable energy and hydrogen projects in the U.S.

The two companies are also planning to cooperate in the secondary battery material business.

Korea Zinc unveiled plans to invest 735.6 billion won in its cooper foil subsidiary KZAM to expand production capacity to 60,000 tons per year.

Shares of Korea Zinc traded up 6.78 percent to 551,000 won on Monday afternoon.

By Han Woo-ram and Susan Lee

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]