South Korea is exploring a significant $22.3 billion investment in a natural gas power project in Texas, marking its inaugural major venture under a broader $350 billion financial commitment to the United States. The project, proposed for Encinal, aims to construct a 6.3-gigawatt gas-fired power plant. This initiative is driven by the escalating electricity needs associated with the rapid growth of AI data centers and advanced semiconductor facilities in Texas.
Initially, South Korea contemplated investing approximately $19.8 billion, while the United States had aimed for around $25 billion. Through negotiations, both parties have reportedly converged on a prospective investment of about $22.3 billion, though the final figures and the plant’s generating capacity remain subject to change. The development is planned to proceed in stages, starting with an addition of 1.4 gigawatts of gas turbine capacity. Depending on the rise in electricity demand and economic conditions, this could be followed by an expansion of up to 4.9 gigawatts of combined-cycle generation.
In addition to the Texas project, South Korea and the United States are in talks over a potential expansive nuclear program. The U.S. has proposed dedicating as much as $120 billion from the investment package to build up to eight large nuclear reactors. These discussions are considering the use of South Korea’s APR100 reactor design for two of these units.
The $350 billion investment commitment is divided into $200 billion allocated for a range of U.S. investments, with the remaining $150 billion aimed at bolstering the American shipbuilding industry. Before finalizing these investment arrangements, South Korea must provide a briefing to its National Assembly. The two nations could potentially sign a memorandum outlining the investment framework as early as September 18, although negotiations continue. According to South Korea’s industry ministry, no final decision has been reached regarding either the Texas gas project or the proposed U.S. nuclear program.