South Korea is eyeing a significant investment in Texas with a proposed $22.3 billion natural gas power project. This initiative marks the first substantial move in line with South Korea’s $350 billion investment pledge to the United States. The proposed development in Encinal aims to construct a 6.3-gigawatt gas-fired power plant, catering to the rising electricity demand fueled by the swift growth of AI data centers and advanced semiconductor facilities in the region.
Initial discussions saw South Korea considering an investment of around $19.8 billion, while the U.S. had been seeking closer to $25 billion. Current negotiations have brought the numbers closer together, aligning at approximately $22.3 billion. However, both the final investment amount and the plant’s generating capacity remain subject to change as talks continue.
The project’s development is anticipated to proceed in phases. The first phase is set to introduce about 1.4 gigawatts of gas turbine capacity. This could be followed by the addition of up to 4.9 gigawatts of combined-cycle generation, contingent on future electricity demand and economic conditions.
In addition to the Texas gas project, discussions between South Korea and the United States extend to a potential large-scale nuclear program. Washington has proposed utilizing up to $120 billion from the investment package to construct as many as eight large nuclear reactors. Talks have included the potential use of South Korea’s APR100 reactor design for two of these units.
The comprehensive $350 billion commitment includes $200 billion allocated for broader investments across the U.S., with another $150 billion directed towards bolstering the American shipbuilding industry. Before finalizing these investment plans, Seoul must provide a briefing to its National Assembly. The two nations could potentially sign a memorandum of understanding outlining this investment framework as early as September 18, though negotiations are still underway. South Korea’s industry ministry has clarified that no definitive decisions have been reached regarding the Texas gas project or the proposed nuclear program in the U.S.