South Korea is positioning itself at the forefront of the global artificial intelligence (AI) race with plans to construct a massive data center in South Jeolla province, boasting a power capacity of up to 3 gigawatts. Announced by Stock Farm Road, an investment group co-founded by LG heir Brian Koo and Amin Badr-El-Din of BADR Investments, this ambitious project carries an estimated price tag of $35 billion, with an initial investment of $10 billion. Set to break ground in early 2025 and target completion by 2028, the facility could redefine the technological and economic landscape both domestically and internationally.
A Strategic Vision for AI Dominance
The scale of this data center is unprecedented, dwarfing most existing facilities where capacities rarely exceed 1 gigawatt. For context, it’s nearly three times the size of the Stargate project in Texas, a collaboration between OpenAI and SoftBank. This leap reflects South Korea’s strategic intent to meet the skyrocketing demand for AI compute power, driven by advancements in machine learning, natural language processing, and computer vision. As Epoch AI forecasts suggest, the largest AI models could require over 5 gigawatts by 2030, making this project a timely investment in future-proof infrastructure.
Stock Farm Road’s leadership sees it as more than just hardware. “This is a strategic leap forward for Korea’s global technological leadership,” said Amin Badr-El-Din in a statement reported by Artificial Intelligence News. The involvement of Brian Koo, leveraging his LG lineage, adds industrial heft, while partnerships with South Jeolla’s provincial government ensure logistical support through a memorandum of understanding (MoU) for energy and water access.
South Jeolla: A Calculated Location Choice
The decision to site the data center in South Jeolla, a southwestern province far from Seoul’s crowded tech hubs, is both tactical and economic. Lower land costs and access to underutilized power generation—primarily from coal and nuclear plants—make it an attractive spot, as noted by Data Center Dynamics. The South Korean government bolsters this choice with a 50% discount on electric facility levies for data centers outside the capital region until May 2026, according to W.Media. This incentive aligns with a broader policy to decentralize tech infrastructure, easing strain on Seoul’s grid and fostering regional growth.
Powering the Beast: Innovation Meets Challenge
A 3-gigawatt facility demands a robust energy strategy, and South Korea is exploring a mix of traditional and cutting-edge solutions. An MoU between LS Electric and Korea Hydro and Nuclear Power Corporation, reported by Data Center Dynamics, hints at small modular reactors (SMRs) with a 170MW capacity as a potential power source. Meanwhile, Samsung and Korea Southeast Power are collaborating on a hydrogen-powered data center model, per another Data Center Dynamics report. The Institute for Energy Economics and Financial Analysis (IEEFA) underscores the need for South Korea to triple its renewable energy capacity by 2030 to sustain such AI-driven demands, suggesting a hybrid approach could emerge.
Yet, energy isn’t the only hurdle. Supply chain constraints—particularly for AI-critical chips like Nvidia’s GPUs—pose risks, as Mint highlights. Behind-the-meter agreements with power providers may mitigate grid pressures, but securing materials and talent in a competitive global market remains a concern.
Economic Ripple Effects
The economic upside is substantial. Computer Weekly estimates the project will create 10,000 jobs spanning energy, construction, and R&D, injecting vitality into South Jeolla’s economy. Beyond direct employment, the data center could attract a cluster of AI startups, tech giants, and research institutions, mirroring Silicon Valley’s ecosystem. Local players like Naver and Samsung, alongside international firms such as OpenAI (via its Kakao partnership, per Reuters), and SK Telecom’s GPU cloud venture with Lambda (Data Center Dynamics), are poised to tap this resource.
South Korea’s government sees this as a cornerstone of its Digital New Deal, a policy framework aimed at accelerating digital transformation, as outlined by Credence Research. The $35 billion investment could yield long-term dividends, positioning the country as a hub for AI innovation and challenging competitors like the U.S. and China.
A Global Benchmark
Globally, the project sets a high bar. OpenAI’s rumored 5-gigawatt ambitions, reported by Fortune, and the broader strain on power grids detailed by Bloomberg illustrate the escalating energy demands of AI. South Korea’s 3-gigawatt facility, however, benefits from a proactive government and a concentrated industrial base—advantages over regions like Malaysia or India, which offer lower costs but lack comparable infrastructure, per Mint.
Business Implications
For enterprises, this data center signals opportunity. Its capacity could slash latency and costs for AI workloads, attracting cloud providers, hyperscalers, and firms needing high-performance computing. Partnerships with SK Telecom or Kakao could open doors for tailored AI services, while the facility’s scale might pressure competitors to accelerate their own infrastructure investments.
With construction looming, the focus shifts to execution. Can South Korea secure the power and chips needed to bring this vision to life? Will it balance economic growth with environmental sustainability? The answers will shape not just the project’s success but South Korea’s standing in the global tech race. For now, the announcement alone marks a bold statement: in the age of AI, South Korea intends to lead, not follow.
Key Data Points:
- Power Capacity: Up to 3 gigawatts
- Cost: $35 billion total, $10 billion initial
- Timeline: Start early 2025, complete 2028
- Jobs: 10,000 projected
- Backers: Stock Farm Road (Brian Koo, Amin Badr-El-Din)
- Location: South Jeolla province
Sources:
- Wall Street Journal, Mint, Computer Weekly, Data Center Dynamics, W.Media, IEEFA, Reuters, Credence Research, Fortune, Bloomberg, Statista, Artificial Intelligence News
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