Steel industry welcomes Korea's first US investment project, eyes link to HPLS mill

South Korea's steel industry has welcomed the government's selection of its first strategic US investment project, expressing hope that it could be linked to the $5.8 billion electric arc furnace steel mill that Hyundai Steel, Posco and others are building in Louisiana.

The Korea Iron and Steel Association issued a statement Thursday titled "The steel industry's position on the announcement of the first US investment project," saying it "extends its deepest welcome to the Ministry of Trade, Industry and Energy's final confirmation of the first US investment project."

The South Korean and US governments announced Thursday that they would pursue "Project Star" — the construction of a gas-fired combined-cycle power plant for AI data centers in Encinal, Texas — as the first project under a Korea-US strategic investment MOU. The total project cost is $22.3 billion, with a generation capacity of 6,472 megawatts. The project aims to begin Phase 1 commercial operation in 2029 and bring all facilities into full operation by 2032.

"Project Power," a Korea-US nuclear power plant cooperation initiative, and "Project North," an Alaska LNG project, were also included in the investment plans. However, the Alaska LNG project has not been confirmed for investment and remains at the stage of reviewing commercial viability and domestic legal requirements.

The steel industry said the investment would serve as an opportunity to strengthen Korea-US supply chain cooperation.

The association said it expects "this US investment project to serve as an important opportunity to expand economic and industrial cooperation between the two countries and more closely connect their supply chains."

What drew particular attention from the industry was the integrated electric arc furnace steel mill under development in Louisiana.

Hyundai Steel-Posco Louisiana Steel, or HPLS — a joint venture established by Hyundai Steel, Posco, Hyundai Motor Company and Kia — is investing a total of $5.8 billion to build an integrated electric arc furnace steel mill in Ascension Parish, Louisiana. The facility will have an annual production capacity of 2.7 million tons and is targeting commercial production in 2029.

The association said that "if HPLS's $5.8 billion investment in an integrated electric arc furnace steel mill in Louisiana is linked to this US investment plan, significant synergy is expected in building a local supply chain connected to major US demand industries — including automobiles, shipbuilding, energy and infrastructure — centered on steel."

The association added that it "once again welcomes the government's announcement of the first US investment project and is deeply grateful for the government's dedication and hard work in making it happen."