South Korea Eyes $22.3 Billion Texas Gas Plant to Power AI Data Centers
Key Takeaways
- •South Korea has reportedly agreed to invest $22.3 billion in a 6.3 GW gas-fired power plant in Texas, its first investment under its trade deal with the United States.
- •The planned plant would supply electricity to data centers in Texas, where grid operator ERCOT forecasts sharply rising demand from large loads such as AI facilities.
- •Seoul has pledged roughly $350 billion in total U.S. investments, with some funds potentially going to a nuclear power project or Alaska LNG.
- •Under the trade agreement announced in July, South Korea faces a 15% tariff on U.S. imports instead of the originally threatened 25%, and committed to $100 billion in U.S. LNG and energy purchases.
- •Asian spot LNG prices rose to nearly $26 per million British thermal units as U.S.-Iran hostilities resumed in the Persian Gulf, and Qatar extended force majeure on its exports.
South Korea has reportedly agreed to invest $22.3 billion in a gas-fired power plant in Texas as part of its trade deal with the Trump administration.
The investment would mark South Korea's first under the trade deal, Reuters reported, citing Korean media. The planned power plant would have a capacity of 6.3 GW and supply electricity to data centers in the state. Texas has become a major hub for data center construction, with the state's grid operator, ERCOT, forecasting sharply rising electricity demand from large loads such as AI facilities — a trend that has prompted developers to look at gas-fired generation to power new projects.
Like other Asian countries, South Korea has pledged billions of dollars in U.S. investments in exchange for more favorable import tariff conditions from President Trump. In total, Seoul has promised to invest some $350 billion in the United States. According to Korean media, some of that money could go toward a nuclear power plant project or Alaska LNG.
In July last year, President Trump announced a deal imposing a 15% tariff on imports from South Korea, averting a much steeper 25% levy originally threatened by Washington. As part of the trade agreement, South Korea committed to purchasing $100 billion worth of U.S. liquefied natural gas and other energy commodities — a move President Trump hailed as a win for American workers and energy producers.
In early 2026, South Korea also signaled plans to import more crude oil from the United States, a decision hastened by the U.S. and Israeli war against Iran and the resulting squeeze on energy exports to Asia.
Meanwhile, Asian spot liquefied gas prices surged last week to almost $26 per million British thermal units as the United States and Iran resumed exchanging fire in the Persian Gulf, casting new doubt on the chances of a resumption of normal tanker traffic through the waterway anytime soon. South Korea is the world's third-largest importer of liquefied natural gas, after China and Japan. Qatar, meanwhile, has extended the force majeure on its exports. For Seoul, the reported Texas plant and broader U.S. energy commitments also come as Korean industry faces domestic constraints on building new power generation at home, adding a practical dimension to channeling energy investment abroad.
By Charles Kennedy for Oilprice.com
