According to Liberty Times No. 28, under the mediation of the Ministry of Economic Affairs, the world’s largest steelmaker China Iron and Steel Corporation (CSC), Lianhua Xinde Group (Mytac Sintok Group) and the world’s largest industrial gas producer Germany’s Linde AG will set up a new company to produce neon (Ne), a rare gas used in semiconductor lithography processes. The company will be the first neon gas production company in Taiwan, China. The plant will be the result of growing concerns over the supply of neon gas from Ukraine, which accounts for 70 percent of the global market, following Russia’s invasion of Ukraine in February 2022, and is also the world’s largest foundry, Taiwan Semiconductor Manufacturing Company (TSMC) and others. The result of the production of neon gas in Taiwan, China. The location of the factory is likely to be in Tainan City or Kaohsiung City.

Discussions about the collaboration started a year ago, and the initial direction seemed to be that CSC and Lianhua Shentong would supply crude neon, while the joint venture would refine high-purity neon. The investment amount and investment ratio are still in the final stage of adjustment and have not been disclosed.

Neon is produced as a by-product of steelmaking, said Wang Xiuqin, general manager of CSC. Existing air separation equipment can produce oxygen, nitrogen and argon, but equipment is needed to separate and refine crude neon, and Linde has this technology and equipment.

According to reports, CSC plans to install three sets of air separation plants at its Xiaogang plant in Kaohsiung City and the plant of its subsidiary Longgang, while Lianhua Shentong plans to install two or three sets. The daily output of high-purity neon gas is expected to be 240 cubic meters, which will be transported by tank trucks.

Semiconductor manufacturers such as TSMC have demand for neon and the government hopes to purchase it locally, an Economy Ministry official said. Wang Meihua, director of the Ministry of Economic Affairs, established the new company after a phone call with Miao Fengqiang, chairman of Lianhua Shentong.

TSMC promotes local procurement

Following the Russian invasion of Ukraine, two Ukrainian neon gas-producing companies, Ingas and Cryoin, ceased operations in March 2022; the production capacity of these two companies is estimated to account for 45% of the world’s annual semiconductor usage of 540 tons, and they supply the following regions : China Taiwan, South Korea, Mainland China, the United States, Germany.

According to Nikkei Asia, the English-language outlet of Nikkei, TSMC is buying equipment to produce neon gas in Taiwan, China, in cooperation with several gas manufacturers within three to five years.