The Ministry of Trade, Industry and Energy reported to the National Assembly on the 22nd that a combined-cycle gas power plant project in Encinal, Texas, has been selected as the first investment project in the United States, according to sources. The ministry is also pursuing the construction of eight large nuclear reactors in the U.S. and an Alaska liquefied natural gas development project as its second and third projects.
In a closed-door briefing to the National Assembly's Trade, Industry, Energy, SMEs and Startups Committee, the ministry presented the Texas combined-cycle gas plant as the first U.S. investment project. It then reported the construction of eight large nuclear reactors in the U.S. as the second project and the Alaska LNG development as the third.
The three projects are at different stages, however, sources said. Trade, Industry and Energy Minister Kim Jung-kwan said in open remarks to the committee that one of the U.S. investment projects has been decided, while the remaining two will be pursued in ways that reflect the interests of both countries. The Texas gas plant is therefore the most advanced, while the nuclear and Alaska LNG projects are expected to undergo further consultations before their commercial viability is assessed.
The ministry also reported that it is in talks with the U.S. side on acquiring a stake in Westinghouse Electric Co. in connection with the project to build eight new nuclear reactors in the U.S., according to sources. The size of the equity investment is currently under negotiation in a range of 5% to 10%, sources said.
The Westinghouse stake is tied to how Korean companies would take part in nuclear plant construction in the U.S. The government is expected to discuss with Washington the detailed business structure of the nuclear construction projects and the scope of Korean corporate participation.
On the scale of investment, the ministry reaffirmed an existing agreement that no additional investment will be made once annual spending exceeds $20 billion or the cumulative total exceeds $200 billion.
One committee member said the Texas gas plant "is said to offer good profitability," adding that "there is nothing concrete yet on the Alaska LNG development project. The ministry reported that it is too early to judge its commercial viability."
Another committee member said after the closed-door briefing that "the date for signing a memorandum of understanding appears not to have been set yet," adding that "Korean-type reactors should of course be included in nuclear investment in the United States."
