South Korea is eyeing a significant $22.3 billion investment in a natural gas power project located in Texas, marking its first substantial contribution under a broader $350 billion investment strategy targeted at the United States. The planned project, situated in Encinal, aims to construct a 6.3-gigawatt gas-fired power plant to address the growing electricity demand spurred by the rapid growth of AI data centers and advanced semiconductor facilities in the region.
Initially, South Korea considered a $19.8 billion investment, while the United States was looking for closer to $25 billion. Ongoing negotiations have brought the parties closer to an agreement of approximately $22.3 billion, though the final investment amount and the plant’s generating capacity may still be adjusted. The project is intended to develop in phases, starting with the addition of around 1.4 gigawatts of gas turbine capacity. This would be followed by up to 4.9 gigawatts of combined-cycle generation, contingent on electricity demand and economic conditions.
In addition to the gas power project, South Korea and the United States are exploring a potential large-scale nuclear program. As part of this discussion, Washington has proposed dedicating up to $120 billion of the investment package to construct as many as eight large nuclear reactors. The talks include the possible deployment of South Korea’s APR100 reactor design for two of these units.
The $350 billion investment package is divided into $200 billion for general U.S. investments and $150 billion set aside to bolster the U.S. shipbuilding industry. Before finalizing any agreements, South Korea is required to brief its National Assembly on these investment plans. While the two nations aim to sign a memorandum outlining the investment framework as early as September 18, discussions are still in progress. According to South Korea’s industry ministry, no conclusive decisions have been reached regarding either the Texas gas project or the proposed U.S. nuclear initiative.