By David Lawder, Jarrett Renshaw and Makiko Yamazaki
WASHINGTON/TOKYO, Feb 17 (Reuters) – President Donald Trump’s administration on Tuesday announced three projects valued at $36 billion to be financed by Japan, including an oil export facility in Texas, an industrial diamonds plant in Georgia and a natural gas power plant in Ohio.
The projects are the first investments under Japan’s $550 billion U.S. investment pledge as part of a trade deal that cut Trump’s tariffs on Japanese imports to 15%, Trump said on Truth Social. He gave few details about the projects.
Commerce Secretary Howard Lutnick said in a statement that the Portsmouth, Ohio power plant, valued at $33 billion, would be the largest natural gas-fired generating facility in history with a capacity of 9.2 gigawatts.
The facility, to be operated by SB Energy, a subsidiary of Japanese tech investor SoftBank Group, would increase baseload power at a time of fast-growing electricity demand from data centers built to power artificial intelligence applications.
The White House said Japan would invest in the $2.1 billion Texas GulfLink deepwater crude oil export facility off the Texas coast.
“This project is expected to generate $20–30 billion annually in U.S. crude exports, secure export capacity for our refineries, and reinforce America’s position as the world’s leading energy supplier,” Lutnick said.
Texas GulfLink, which is being developed by Sentinel Midstream, confirmed that it was part of the initiative and was “honored to be a trusted partner with the U.S. Department of Commerce and the government of Japan.”
Trump said the Texas investments would include a liquefied natural gas project, but Lutnick’s statement and a White House fact sheet did not mention LNG.
Lutnick said the third major project in Georgia was a synthetic industrial diamond manufacturing plant that would satisfy 100% of U.S. demand for synthetic diamond grit, a critical input for advanced manufacturing and semiconductor production. The U.S. currently relies largely on China for such supplies.
The high-pressure synthetic diamond plant, valued at about $600 million, will be operated by Element Six, the White House said in a fact sheet. The industrial diamond company is a unit of De Beers Group, the world’s largest diamond producer.
It was unclear how much of the projects’ costs would be funded by Japanese entities and under what conditions. Under an earlier U.S.-Japan agreement, profit from the projects was due to be shared 50-50 between the U.S. and Japan until Japan’s initial investment costs were recouped, after which profit would be split 90-10 in favor of the U.S.
The administration’s announcements followed meetings last week between Lutnick and Japan’s economic and trade minister Ryosei Akazawa, where they worked out remaining issues before deals could be announced.
“The scale of these projects are so large, and could not be done without one very special word, TARIFFS,” Trump wrote on Truth Social.
MORE DEALS COMING
“All of these projects involve Japan and the United States working together to build supply chains in strategically important fields,” Akazawa told reporters in Tokyo on Wednesday.
He also said that Japan would continue to work with the U.S. for more investment deals, adding that Tokyo has pledged investments of up to $550 billion before the end of Trump’s current term in office.
While declining to comment on the estimated timing for forthcoming deals, Akazawa said he, as a negotiator, “would keep in mind that Prime Minister Sanae Takaichi’s planned U.S. visit (in March) would be fruitful.”
Multiple Japanese firms expressed interest in the three initial projects, according to the Japanese government, including Noritake as an off-taker for the diamond project, Mitsui O.S.K. Lines and Nippon Steel as suppliers for the crude oil export facility project, and Hitachi and Toshiba for the power project.
Japan’s investment package would consist of equity, loans and loan guarantees from state-owned agencies Japan Bank for International Cooperation (JBIC) and Nippon Export and Investment Insurance (NEXI).
Akazawa has said the investment would have no foreign exchange impact in light of sizable foreign currency reserves that the government could use for loans.
(Reporting by Christian Martinez, David Lawder and Jarrett Renshaw in Washington, Laila Kearney and Makiko Yamazaki; Writing by David Lawder and Ismail Shakil; Editing by David Gregorio)
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