U.S. President Donald Trump has welcomed Japan’s pledge to invest nearly $36 billion in oil, gas and critical mineral projects in Texas, Ohio and Georgia.
The commitment represents the first tranche of investments by Japan following a landmark trade deal between the two countries, one in which Tokyo pledged to invest $550 billion in American-based projects and Trump cut tariffs on most Japanese imports to 15%.
“Our MASSIVE Trade Deal with Japan has just launched!” Trump said Tuesday in a social media post.
“The scale of these projects are so large, and could not be done without one very special word, TARIFFS,” he added.
Japanese Prime Minister Sanae Takaichi said the projects strengthen the Japan-U.S. alliance and were expected to bring increased sales and business expansion for Japanese companies.
“We believe these initiatives truly embody the purpose of this Strategic Investment Initiative, namely the promotion of mutual benefit between Japan and the United States, the enhancement of economic security, and the promotion of economic growth,” Takaichi said in a post on X, according to a Google translation.
By far the largest investment is a natural gas facility in Ohio that’s expected to generate 9.2 gigawatts of power.
U.S. Commerce Secretary Howard Lutnick said the Portsmouth Powered Land Project, valued at $33 billion and operated by SB Energy, a subsidiary of Japan’s SoftBank, would be “the largest natural gas generation facility in history.”
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The White House said Japan would also finance a $2.1 billion deepwater crude oil export facility off the Texas coast. At full capacity, the Texas GulfLink project is expected to generate up to $30 billion in annual U.S. crude exports. Dallas-based energy infrastructure group Sentinel Midstream is developing the project.
The Commerce Department said the third major project refers to plans to create a synthetic diamond grit facility in Georgia, with Japan set to invest approximately $600 million.
The project is set to be operated by Element Six, part of De Beers Group, the world’s leading diamond company.
Diamond grit, dust and powder are critical raw materials in U.S. industrial manufacturing due to their exceptional hardness and wear resistance, the Commerce Department said, making the material to U.S. economic and national security.
Source: CNBC