South Korean investment in America’s fuel supply chain could reduce reliance on Russia while securing enriched uranium access for both allies.

America’s nuclear dreams are back in vogue. After decades of stagnation, Washington now talks about tripling nuclear capacity by 2050, reviving old plants, and deploying fleets of small modular reactors (SMRs). But there is a catch: reactors without fuel are just costly iron. While political speeches extol nuclear power as a climate and security panacea, reality bites in the details of uranium enrichment and fuel supply, the intangible infrastructure that quietly sustains every gigawatt of atomic output. South Korean capital might prove to be the unexpected linchpin.

A Supply Chain Under Stress

The supply chain for low-enriched uranium (LEU) and high-assay low-enriched uranium (HALEU), the feedstock for conventional reactors and advanced SMRs, respectively, is heavily dominated by Russia. Russia’s Rosatom and its affiliates control about 40 percent of global enrichment capacity. Even before geopolitical tensions injected uncertainty into markets, this concentration implied vulnerability; afterwards, it became a strategic headache.

South Korea’s own experience illustrates this predicament. According to Korea Hydro & Nuclear Power (KHNP), between 2020 and 2024, about 32 percent of South Korea’s imported LEU came from Russia. While less than the 38 percent sourced from France, it is still a significant share, especially for a nation that generates about one-third of its electricity from nuclear power and views energy security as a strategic imperative.

In Washington, policymakers lament that America’s enrichment infrastructure has withered. Centrus Energy’s plant in Piketon, Ohio, America’s sole commercial enrichment facility, has been reduced to niche demo production of HALEU, insufficient for a robust domestic fuel base. Moscow is happy to fill gaps for America’s nuclear strategy, and that is politically uncomfortable.

Seoul’s Strategic Nuclear Pivot

Instead of standing aside, South Korea is acting. In August 2025, KHNP and POSCO International signed a memorandum of understanding (MOU) with Centrus to co-invest in expanding Piketon’s enrichment capacity. The deal is not merely contractual, but it reflects a broader shift in South Korea’s nuclear strategy from passive importer to co-investor in fuel infrastructure.

This shift is shaped by three forces:

1. Energy security: Diversifying away from Russian LEU reduces strategic vulnerability.
2. Industrial ambition: South Korean firms have world-class reactor-export credentials and see enrichment investment as a way to capture more value from nuclear supply chains.
3. Alliance politics: Investing in America’s fuel infrastructure aligns Seoul with US policy aims of reducing reliance on geopolitical competitors.

From Washington’s perspective, allied capital entering sensitive nuclear sectors might seem counterintuitive. Historically, foreign investment in enrichment or reprocessing has been anathema due to proliferation risks. But today’s calculus is different. Geopolitical competition with Russia has made allied fuel security a strategic priority, arguably outweighing older taboos.

123 Agreements and the Politics of Enrichment

The diplomatic hinge for this cooperation is the US–South Korea 123 agreement, named after Section 123 of the US Atomic Energy Act, which governs peaceful nuclear cooperation. Past iterations strictly limited South Korea’s ability to pursue sensitive technologies such as enrichment and reprocessing measures designed to prevent the spread of bomb-grade material.

Under a 2025 revised framework proposed by the Trump administration, that constraint is being reinterpreted. The new language endorses civil uranium enrichment and, potentially, spent fuel reprocessing, subject to legal safeguards and consent mechanisms. President Donald Trump reportedly pitched a 50:50 joint venture with South Korea, urging investment in American enrichment facilities with dual benefits of fuel for South Korea’s reactors and industrial revival in the United States. 

This diplomatic shift is noteworthy. Non-proliferation norms remain critical, but the focus is evolving from excluding allies from strategic technologies toward controlled co-development within allied frameworks. The political challenge now lies in balancing security assurances with commercial opportunity.

HALEU: The Bottleneck and the Opportunity

Centrus’s Piketon site has produced approximately 920 kilograms of HALEU during Department of Energy (DOE) demonstration runs. Expanding this to commercial LEU and HALEU production by the late 2020s requires billions in capital and long-term offtake commitments. This is where South Korean investment is starting to matter. KHNP’s capital and POSCO’s industrial heft could underwrite expansion, with DOE subsidies sweetening the long lead times and regulatory hurdles.

For South Korea, the payoff is stable access to enriched uranium. For the United States, the payoff is revitalized domestic fuel capacity with allied backing, reducing dependence on Russia. 

Beyond Enrichment: The Closed Fuel Cycle Question

The partnership’s implications extend beyond enrichment. South Korea has invested heavily in research on pyroprocessing, a dry reprocessing technique that separates usable isotopes from spent fuel without producing pure plutonium presented as a more proliferation-resistant method than traditional reprocessing. Coupled with sodium-cooled fast reactors (SFRs), which can use mixed-oxide (MOX) or metallic fuels, pyroprocessing could form the basis of a closed fuel cycle that slashes waste volumes by up to 90 percent.

But this is politically fraught. While current 123 agreements allow for research and development collaboration, full-scale reprocessing and plutonium separation remain red lines without explicit US consent. Even among American lawmakers, support for loosening restrictions is mixed. In early 2026, several Democratic senators wrote to administration officials warning that relaxed fuel-cycle norms might undermine non-proliferation.

This tension captures the broader dilemma: how to balance strategic technology sharing with the imperative of preventing weapons proliferation. The answer will shape not just South Korea–US cooperation, but global norms around nuclear fuel cycles.

Nuclear Markets, Capital, and Geopolitics

The expanding market for SMRs and advanced reactors, rising spot prices for enrichment services, and allied strategies of “friendshoring” critical infrastructure all create conditions in which capital and policy align.

If South Korea helps build the West’s fuel backbone, it will do more than underwrite industrial hardware. It will help realign the global nuclear market away from a small number of geopolitical rivals toward an allied-centric supply chain. In this emerging landscape, fuel is not just a commodity but a strategic currency.

And South Korea, once a reactor buyer on the periphery, is positioning itself at the fulcrum of nuclear commerce and geopolitics.

About the Author: Stella Kim

Stella (SuHee) Kim is an investment and nuclear strategy expert with over a decade of experience bridging global finance and deep-tech, with a particular focus on small modular reactors (SMRs). She is the CEO of Pandia Bridge, a Singapore-based advisory firm that connects global investors and leading Korean conglomerates with top SMR developers, including NuScale Power, to facilitate cross-border investments and strategic partnerships. Her work centers on the intersection of energy security, technology innovation, and strategic finance on a global scale. She holds a BA from Ajou University in South Korea and participated in a study abroad program at the Luleå University of Technology in Sweden.

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