South Korea’s first U.S. investment project may be a $22.3 billion Texas gas power plant, with eight nuclear reactors also under review

A $22.3 billion gas-fired combined-cycle power plant in Encinal, Texas, is emerging as the first project in South Korea’s planned investment in the United States, according to people briefed on government discussions.

Seoul and Washington are reportedly moving toward signing a memorandum of understanding on September 18 covering major elements of South Korea’s investment. The broader package, linked to last year’s tariff agreement with the United States, involves $200 billion in investments in energy and advanced industries.

South Korea’s Industry and Finance ministries briefed ruling-party lawmakers on the negotiations during a government-party meeting at the National Assembly. Several participants said the Encinal project was likely to cost $22.3 billion. The final agreement may also include plans to build eight nuclear reactors in the United States, although one participant said the document would set the broad direction without fixing the investment amount.

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The construction of eight nuclear reactors will likely be included in the agreement only as a broad direction, without fixing the investment amount.

The package is also expected to include the Alaska liquefied natural gas development project, which U.S. President Donald Trump has urged South Korea and Japan to join. One participant said lawmakers had been told that an undersea tunnel project could also be included.

Another participant said the overall scale of the projects, including the Encinal gas project, was substantial and that their commercial viability was likely to become a central issue.

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The overall scale of the projects, including the Encinal gas project, is substantial, so commercial viability is likely to become an issue.