CHONGQING - Southwest China's Chongqing Steel and the Republic of Korea's POSCO will launch an ironmaking project in June in Chongqing municipality, according to the city's economy and informatization committee.

Chongqing Iron and Steel (Group) Co Ltd (Chongqing Steel) and multinational steelmaker POSCO (Pohang Iron and Steel Company) will collaborate on the project, which will be built at a cost of 15 billion yuan ($2.4 billion), the committee said.

According to the committee, FINEX (Fine Ore Reduxtion Smelting) technology will be a core feature of the project. The technology will allow the companies to save 20 percent in production costs and create more room for additional equipment in steel factories.

The project is expected to have an annual output of 3 million tons of iron and 3.14 million tons of steel.

The committee said the production value of the project will reach 13.5 billion yuan in its first year, earning 2 billion yuan in profits and employing 2,500 people.

Chongqing Steel is one of the largest state-owned industrial enterprises in Chongqing.

POSCO, set up in 1968, is one of the largest steelmakers in the world.