South Korea and the United States have reached agreement on an approximately $22.3B investment to build a massive gas-fired power plant in Encinal, Texas. The facility, designed with a combined capacity of 6.3 gigawatts, is aimed squarely at the surging electricity demand created by AI data centers.
The deal behind the deal
This isn’t a standalone energy project. It’s the first concrete deliverable from a much larger bilateral trade framework established in 2025, under which South Korea pledged a staggering $350B in total US investments.
That $350B breaks down into $200B earmarked for cash and strategic projects and $150B dedicated to shipbuilding cooperation. In exchange, the US agreed to hold tariffs on Korean goods at 15%.
The gas plant investment itself has been a moving target. Earlier projections in July 2026 pegged the figure at $19.8B, with discussions underway to potentially push it as high as $25B. The number appears to have landed at $22.3B, though South Korea’s Ministry of Industry has not yet officially confirmed the final figure.
