South Korea has selected a gas-fired power station in Encinal, Texas, as the first project under its wider $350bn US investment pledge, with the project valued at $22.3bn.

Yonhap News Agency, citing parliamentary sources, reported that the Ministry of Trade, Industry and Resources briefed the parliamentary trade committee on the plan in a closed-door session.

The government expects the Texas project to generate revenues of up to $45.4bn over 20 years, exceeding recovery of the principal and interest.

The decision comes after months of talks on implementing a South Korea–US joint fact sheet (JFS) covering investment pledges made in return for lower US import tariffs.

The power plant is set to have total installed capacity of 6.3GW and is aimed at helping address increasing electricity demand from a rising number of semiconductor plants and artificial intelligence data centres in Texas.

The JFS was adopted after a summit last year between South Korean President Lee Jae Myung and US President Donald Trump.

It outlines Seoul's investment commitments, including $150bn for shipbuilding cooperation, together with security arrangements linked to South Korea's push to develop nuclear-powered submarines and obtain rights to enrich uranium and reprocess spent nuclear fuel.

The ministry has also prepared plans for two additional projects: building eight large-scale nuclear reactors in the US and developing a liquefied natural gas project in Alaska.

Those two projects, unlike the Texas plant, will need further discussions with the US.

US officials have reportedly opposed South Korea's interest in buying a roughly 20% stake in US energy company Westinghouse to support construction of the reactors.

According to the report, Industry Minister Kim Jung-kwan told lawmakers the two sides are discussing a stake of 5% to 10%, which he said would be sufficient to secure voting rights.

Kim also restated the government's position that no investment will go ahead if the total goes beyond a $200bn ceiling.

He did not provide a timetable for signing a memorandum of understanding (MoU) to complete the Texas project.

A committee member said the MoU is likely to be announced by President Donald Trump at a politically opportune moment before the US midterm elections in November.

Earlier this month, four US companies agreed to invest a combined $2bn in South Korea in semiconductor inputs, wafer-fab equipment, advanced materials and renewable power.

The companies are Air Products, Axcelis Technologies, Corning and Pacifico Energy.