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POSCO Inks MOU to Promote Sewage Heat Utilization Project in Mongolia

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Key Takeaways

  • POSCO INTERNATIONAL signed an MOU with Ulaanbaatar for a sewage heat supply system.
  • A feasibility study runs until 2026, with a 15-year BOT model planned if viable.
  • The project targets heating 4,000 households while reducing emissions and fine dust.

POSCO’s (PKX - Free Report) unit, POSCO INTERNATIONAL, has signed a memorandum of understanding (“MOU”) with the city of Ulaanbaatar, Mongolia, to promote a heat supply project using sewage heat. According to the agreement, POSCO INTERNATIONAL will work to supply waste heat from the central sewage treatment plant to nearby redeveloped residential areas.

A joint feasibility study is to be completed by the first half of 2026, following which the project is expected to enter full-scale implementation in the second half under a 15-year Build-Operate-Transfer (“BOT”) model if viability is confirmed. The system will provide district heating to about 4,000 households of a newly constructed residential complex.

Ulaanbaatar being a witness to the most severe air pollution during winter, POSCO INTERNATIONAL’s initiative becomes crucial to address the issue caused by coal-based heating, as recycling waste heat from the sewage treatment process will reduce both greenhouse gas emissions and fine dust.

The company has prior experience in this field, having successfully carried out a sewage heat-based district heating project at Seoul’s Tancheon Water Treatment Center. That project supplies 204,900 Gcal of heat annually to 20,000 households in Gangnam-gu, saving energy equivalent to 20,490 tons of oil and reducing 33,972 tons of carbon dioxide emissions.

The Ulaanbaatar city government views this partnership as a way to address pollution, improve the quality of life and support sustainable urban development. This MOU highlights POSCO's sustainable heating technologies and global business capabilities as it plans to expand beyond Mongolia to other regions in Central Asia.

PKX’s shares have lost 27.9% over the past year compared with the industry’s 18.5% decline.

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PKX’s Zacks Rank & Key Picks

PKX currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the Basic Materials space are Methanex Corporation (MEOH - Free Report) , Carpenter Technology Corporation (CRS - Free Report) and The Mosaic Company (MOS - Free Report) . MEOH sports a Zacks Rank #1 (Strong Buy), while CRS and MOS carry a Zacks Rank #2 (Buy) each at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for MEOH’s current-year earnings is pegged at $3.72 per share. Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 83.18%. MEOH’s shares have gone up 0.8% in the past year.

The Zacks Consensus Estimate for CRS’ current fiscal-year earnings is pegged at $9.51 per share, indicating a 27.14% year-over-year increase.Its earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with an average surprise of 8.38%. CRS’shares have surged 52.8% in the past year.

The Zacks Consensus Estimate for MOS’ 2025 earnings is pegged at $3.17 per share, indicating a rise of 60.10% from year-ago levels. The company’s earnings beat the consensus estimate in one of the trailing four quarters while missing it in the rest. MOS’ shares have gained 36.8% in the past year.

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