The US and South Korea are set to announce an agreement for Seoul to fund a multibillion-dollar gas-fired power plant in Texas, marking the first project under its $350bn investment deal with the Trump administration. The proposed $22.3bn gas-fired power complex in Encinal, Texas, aims to meet surging power demand from data centers and chip fabrication plants. President Donald Trump may unveil the deal himself, depending on preparations for Chinese President Xi Jinping’s arrival in Washington. South Korea’s President Lee Jae Myung, attending the UN General Assembly in New York, met with Trump for 30 minutes in Washington on Tuesday, with both sides welcoming “huge progress” on investments and cooperation.

Under the November 2025 agreement, Seoul will supply $200bn in upfront capital for projects in strategic industries, with annual outlay capped at $20bn. Cash flow from the projects will be split equally with Washington until Korea’s principal and interest are covered, after which Seoul’s share falls to 10%, with the US taking 90%. The Encinal project could generate $43bn-45bn in revenue over 20 years, according to Korean officials.

South Korea last year committed to investing $350bn in the US in exchange for lower tariffs but had yet to identify projects, fueling frustration in Washington. Japan has already announced similar investments, including a $33bn gas-fired power plant in Ohio. Analysts note that the “commercially reasonable” safeguard is weaker than it appears, as the US-led Investment Committee ultimately decides project viability, with Trump making final decisions.