Texas' first $22.3 billion project confirmed... Framework agreement for nuclear power plant unit 8
Trump mentioned more than $50 billion in Alaska... Korea considers whether to invest
Energy projects such as the Texas gas-fired combined cycle power plant, eight large U.S. nuclear power plants, and Alaska liquefied natural gas (LNG) development were listed one after another as targets for Korea's $200 billion strategic investment in the United States. The combined maximum size of the three currently proposed projects is $196.3 billion.
On the 1st, the governments of both Korea and the United States unveiled plans for strategic investment in the United States. The Encinal gas-fired combined cycle power plant in Texas was confirmed as the first project, and a framework for the construction of eight large nuclear power plants in the United States was also agreed upon. Alaska LNG is beginning a review to determine whether to participate in the project.
U.S. President Donald Trump also announced Texas power generation facilities, eight nuclear power plants, and Alaska LNG as Korea's strategic investment projects in the U.S. at the White House on the 30th (local time). Among the $350 billion investment in the United States agreed upon in the Korea-U.S. tariff negotiations last year, the first projects targeted for the $200 billion strategic investment, excluding $150 billion in shipbuilding, were revealed.
Texas $22.3 billion confirmed... Framework agreement for eight nuclear power plants
The first project is the Encinal gas-fired combined cycle power plant in Texas. With a total project cost of $22.3 billion and a facility capacity of over 6GW, it will supply power to AI data centers. The initial commercial operation target is 2029.
We plan to first build a 1.4GW gas turbine power plant and then gradually expand combined cycle power plants by looking at power demand and economic feasibility.
In terms of amount, nuclear power plants are the largest. Up to $120 billion was proposed to build eight large nuclear power plants in the United States. Korea and the United States have agreed on a framework for nuclear power plant construction, but further discussions are needed on the composition of the structure, scope of participation by Korean companies, and investment structure.
A plan to include two Korean APR1400 units is also being discussed. However, the configuration of the furnace type has not yet been confirmed.
The U.S. proposed an investment of more than $50 billion in Alaska LNG. This is a project to build approximately 1,300 km of pipelines and liquefaction facilities to send natural gas produced on the North Slope of northern Alaska to the southern coast.
If you combine $22.3 billion from Texas, up to $120 billion from nuclear power, and $54 billion from Alaska LNG, the total is up to $196.3 billion. This is approximately 98% of the $200 billion strategic investment limit. However, this is the sum of the maximum amounts proposed for the three projects, and is not Korea's confirmed investment amount.
Alaska LNG is ‘reviewed’… Investment size not yet determined
Among the three projects, Alaska LNG is in the most different stages of progress. In a White House announcement, President Trump included Alaska LNG in Korea's strategic investment project in the United States, and U.S. Secretary of Commerce Howard Rutnick mentioned an investment worth over $50 billion. On the other hand, the Korean government is in the position of starting a review to decide whether to participate in the project.
[Source: Alaska LNG, LNG pipeline and main facility layout stretching from the North Slope in northern Alaska to Nikiski in the south]
The scale of the business itself is also large. According to Reuters, the total project cost is estimated at $44.5 billion to $54.5 billion. Approximately 1,300 km of new gas pipelines and LNG liquefaction facilities must be built.
Currently, an agreement on the supply of 13 million tons of LNG per year has been secured, but most of it is not binding. For project financing, it is necessary to secure additional volume and convert the main contract.
The Korean government considers profitability as the premise for investment decisions. Minister of Trade, Industry and Energy Kim Jeong-gwan also presented the possibility of recovering principal and interest from investments in the United States as an important criterion for judgment. The ‘commercial rationality’ that the government refers to is also key to whether the investment principal and interest can be recovered with the expected income during the project period.
The $200 billion strategic investment has begun with the Texas power plant and is now in follow-up procedures for nuclear power plants. The U.S. proposed a scale of more than $50 billion for Alaska LNG, but Korea's actual investment and amount will be decided after a feasibility review.
