South Korea to invest in U.S. nuclear projects, including 8 large reactors

The U.S. Department of Commerce announced Wednesday that South Korea would invest $120 billion in U.S. nuclear power projects, most notably the construction of eight large nuclear reactors at federal sites, as part of a $200 billion investment comprising three separate projects.

Project Power, the $120 billion investment in domestic nuclear projects, is the largest of the three projects announced by the two countries. The nonnuclear power projects included in the plan are a $22.3 billion natural gas power plant in Texas (Project Star) and a liquified natural gas project in Alaska (Project North) that multiple media outlets reported to be worth $50 billion.

Details of the strategic investment have been anticipated but the announcement was delayed, with one of the reasons reportedly being some hesitation over the planned domestic deployment of Korea Hydro & Nuclear Power's APR1400 reactor design. The $200 billion investment in three projects "deemed to advance economic and national security interests" is just one segment of an even larger $350 billion South Korean plan that also includes $150 billion earmarked for the shipbuilding sector.

The details: The DOC said the United States and South Korea agreed to a "comprehensive cooperation framework" to deploy two APR1400 reactors and six AP1000 reactors. Signatories of Project Power include both governments, Westinghouse, Korea Electric Power Corporation, and Korea Hydro & Nuclear Power.

Specific construction timeframes and locations for the eight reactors have yet to be given. However, Brookfield Asset Management-a part owner of Westinghouse-said Wednesday that the AP1000 reactors will be deployed as twin units on three federal sites, and that the two APR1400 reactors will also be built federal sites. Cameco, the other part owner of Westinghouse, also acknowledged the framework announcement. Brookfield Asset Management is a U.S.-based subsidiary of Brookfield Corporation of Toronto, Ontario, Canada, and Cameco is a Canadian uranium fuel provider headquartered in Saskatoon, Saskatchewan.

The AP1000 and the APR1400 are both gigawatt-scale pressurized water reactors. The AP1000 has a nameplate capacity of 1,110 MWe, while the APR1400 has a capacity of 1,400 MWe. Eight APR1400s are currently on line (four in South Korea and four in the United Arab Emirates). Meanwhile, six AP1000s are currently on line (two in the United States and four in China).

Of the Project Power investment, $100 billion would go toward construction costs and the remaining $20 billion would be reserved for contingency purposes. The two countries have agreed to transfer a $10 billion advance payment by the end of the year, which is intended to purchase long-lead items immediately, in accordance with applicable domestic legal requirements.

Furthermore, the agreement includes the possibility for Kepco and KHNP to acquire a "significant minority" stake in Westinghouse. "This arrangement is intended to facilitate the sharing of commercial gains from large-scale nuclear power plant projects, with the detailed terms and conditions to be finalized through commercial negotiations," the DOC said.

According to Brookfield Asset Management, the framework agreement provides for a "cornerstone equity investment of between 5% and 10% in Westinghouse by Korea, further aligning the parties around the long-term growth and deployment of Westinghouse technology."

"Today's announcement marks a defining moment for the future of U.S. nuclear energy and for the longstanding partnership between the United States and the Republic of Korea," Westinghouse president and CEO Dan Sumner said in a statement. "The announcement also underscores the strategic importance of Westinghouse in the deployment of nuclear energy-we bring deep engineering expertise, a proven record of nuclear innovation and unmatched experience delivering advanced reactor technology in the U.S. and around the world."

"They're going to go across the United States. They are going in Ohio, they are going in Tennessee, they are going in South Carolina, and they are going in Kentucky," Commerce Secretary Howard Lutnick said during a September 30 briefing with President Trump, cabinet officials, and Alaskan officials. "These are gigantic nuclear power plants, because we want to create the supply chain for nuclear so we can be the exporter of the world of nuclear."