South Korea is contemplating a significant investment in a natural gas power project in Texas, marking a substantial step in its $350 billion pledge to the United States. This ambitious plan involves constructing a 6.3-gigawatt gas-fired power plant in Encinal, Texas, to address the increasing demand for electricity. This demand surge stems from the rapid growth of artificial intelligence data centers and advanced semiconductor facilities in the state.
Initially, South Korea considered an investment of approximately $19.8 billion, while the United States was seeking around $25 billion for the project. As negotiations have progressed, the two parties appear to be converging on a figure of about $22.3 billion. However, the final investment amount and the generating capacity might still be subject to change.
The development of the gas power project is anticipated to proceed in multiple phases. The first phase is expected to introduce roughly 1.4 gigawatts of gas turbine capacity. Subsequent phases could add up to 4.9 gigawatts of combined-cycle generation, contingent on future electricity demand and economic factors.
In addition to the natural gas project, discussions between South Korea and the United States have extended to the potential establishment of a large-scale nuclear program. The U.S. has proposed earmarking up to $120 billion from the investment package for the construction of as many as eight large nuclear reactors. These talks have included the possibility of utilizing South Korea’s APR100 reactor design for two of these reactors.
South Korea’s $350 billion commitment is divided into $200 billion for broader investments in the U.S. and $150 billion specifically aimed at bolstering the American shipbuilding industry. Before finalizing the investment plans, South Korea is required to consult its National Assembly. Both nations are working towards signing a memorandum that would outline the investment framework, potentially as soon as September 18, though discussions remain ongoing. 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 program.
