POSCO Co. (KSE:005490), South Korea's leading steelmaker, plans to sign a memorandum of understanding (MOU) this week with the Gangwon provincial government on the development of a magnesium mine, company officials said Monday.

POSCO, which has been relying on imported magnesium, started to produce magnesium plates in 2007 as part of efforts to tap into the material sector as a new growth engine.

The steelmaker is expected to build a magnesium refinery plant after exploring the southern areas of Gangwon Province, including Yeongwol, about 200 kilometers east of Seoul.

POSCO and the local government are expected to sign the MOU on Friday.

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