South Korea is exploring a significant $22.3 billion investment in a natural gas power project located in Texas, marking the first substantial move under its pledged $350 billion commitment to the United States. This ambitious project in Encinal aims to construct a 6.3-gigawatt gas-fired power plant, designed to satisfy the growing electricity needs fueled by the swift growth of AI data centers and advanced semiconductor facilities in the region.
Initially, South Korea contemplated a $19.8 billion investment, while the United States had targeted approximately $25 billion. Negotiations have reportedly brought the two sides closer, settling around the $22.3 billion mark, though the final investment amount and the plant’s generating capacity remain subject to change. The development is planned to occur in phases, beginning with the addition of around 1.4 gigawatts of gas turbine capacity, followed by up to 4.9 gigawatts of combined-cycle generation that will depend on future electricity demand and economic conditions.
In addition to the gas project, discussions between South Korea and the United States are also underway regarding a potential large-scale nuclear program. The U.S. has proposed dedicating up to $120 billion from the investment package to construct as many as eight large nuclear reactors. These discussions are also considering the potential use of South Korea’s APR100 reactor design for two of the units.
The comprehensive $350 billion commitment from South Korea includes $200 billion for broader U.S. investments and another $150 billion specifically aimed at bolstering the American shipbuilding industry. Before finalizing the investment arrangements, Seoul is required to report to its National Assembly. The two nations are working on a memorandum that could outline the investment framework, possibly signing it by September 18, although negotiations are still in progress. According to South Korea’s industry ministry, no definitive decisions have been made on either the Texas gas project or the proposed U.S. nuclear program.