South Korea takes a major leap toward sustainable digital infrastructure by announcing a ₩7 trillion ($5.1 billion) AI data center in Ulsan. SK Group and Amazon Web Services (AWS) back this project, which will become the nation’s largest and most energy-efficient facility. The project supports a national strategy to decentralize AI development and advance environmental, social, and governance (ESG) goals. The SK AWS Data Center uses cutting-edge GPU technology and low-emission LNG energy to merge computing power with environmental responsibility. Operations will start in phases, with the first phase of the project expected to begin in 2027.
The Next Phase in Data Center Evolution
Reuters reports that SK Group, one of South Korea’s leading conglomerates, is partnering with Amazon Web Services (AWS) to create the nation’s most advanced artificial intelligence (AI) data center. The facility will be located in Ulsan’s Mipo National Industrial Complex, approximately 305 kilometers southeast of Seoul. With an investment totaling around 7 trillion won (approximately $5.1 billion), including a $4 billion contribution from AWS, this ambitious project marks a major leap forward in Korea’s AI infrastructure development.
Construction will begin later this year, and the groundbreaking ceremony will take place in August as planned. The initial phase will deliver 41 megawatts of capacity, and completion is expected by late 2027. By early 2029, full operations will provide 103 megawatts of power and house 60,000 GPUs, the country’s largest deployment. The site will allow future scalability, and plans include expanding the facility to a one-gigawatt capacity eventually. President Lee Jae Myung said in a statement that,
It may set a good example that South Korea’s high-tech industry is possible not only in the metropolitan area but also in the provinces.
Moreover, AWS’s involvement in this project demonstrates its commitment to expanding its presence and operations in South Korea. AWS already operates data centers in Seoul and Incheon, and it has pledged major investments in cloud and AI infrastructure through 2027. This Ulsan facility supports AWS’s broader strategy to meet growing demand for AI services across the Asia-Pacific region.
Strategic Location and Vision for a Global AI Hub
The decision to base the data center in Ulsan reflects strategic considerations. The location provides steady access to power due to its proximity to SK Gas’s LNG combined heat and power plant. This ensures a stable energy supply and lets the facility use LNG cold energy for efficient cooling of computing systems. Efficient cooling remains critical for high-performance computing environments, where managing heat output significantly affects operational stability and cost.
During the announcement, SK Group Chairman Chey Tae-won outlined the vision to transform the data center into a global AI hub. He stressed that the hub will meet growing AI demand from both domestic markets and international clients across industries. President Myung emphasized the project’s importance for regional growth and showed how high-tech industries can thrive outside metropolitan areas. Furthermore, he noted that such initiatives help drive economic development and demonstrate the potential of technology to reshape regional economies.
The new facility is a central component of SK Telecom’s AI strategy. The company, together with SK Broadband, plans to invest 3.4 trillion won (around $2.5 billion) in AI infrastructure by 2028. This includes building hyperscale data centers, expanding GPU-as-a-Service offerings, and enhancing edge AI capabilities.
These initiatives are part of SK Telecom’s “AI Infrastructure Superhighway” and “AI Pyramid Strategy,” which aim to strengthen Korea’s AI ecosystem and position the company as a global AI leader.
Conclusion
Meanwhile, SK Group pursues ambitions that extend beyond data centers, strengthening its presence across the technology and energy industries worldwide.SK Hynix and SK Innovation, both affiliates, continue playing vital roles in advancing technology and supporting global energy solutions.
At the same time, LG Energy Solution secured a contract with China’s Chery Automobile to supply next-generation cylindrical batteries. This agreement highlights South Korea’s technological strength and reinforces its position as a key player on the global stage. Once operational, the Ulsan AI campus is expected to set new benchmarks in AI processing and data management, helping drive South Korea’s growth in the era of digital transformation.
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