Reuters reported that South Korea POSCO, the world third biggest steelmaker will pay KRW 1.8 trillion to expand its stake in an Australian iron ore mining firm, its biggest investment in resources to date.

POSCO which almost completely relies on imports of iron ore is seeking to expand its stake in Roy Hill Holdings Pty Ltd up to 15% as it seeks to double raw material self-sufficiency to 50% by 2014 from the 2010 level.

The company already owns 3.75% in Roy Hill Holdings and said recently that it was still in talks to finalize the additional stake purchase.

Roy Hill is a joint venture set up between POSCO and Australia Hancock Prospecting to develop the Roy Hill iron ore deposit which is owned by Australia richest woman, Ms Gina Rinehart.

The venture plans to ship its first ore in 2014 at an annualized rate of 55 million tonnes from Western Australia State Port Hedland.

(Sourced from Bloomberg)