Rethinking the U.S.-South Korea 123 Agreement in a New Strategic Era

Executive Summary 

On November 25, 2015, the United States and South Korea’s joint civil nuclear technology agreement, also known as the “Section 123 Agreement,” entered into force, establishing a twenty-year framework for the two nations’ bilateral cooperation. Over a decade later, geopolitical shifts in the global civil nuclear market, alongside changing regional security dynamics, are driving a careful reconsideration—and potential expansion—of the current structure of U.S.-South Korea nuclear technology partnership. As Washington and Seoul explore options to restart nuclear-related discussions, this paper explores the key driving factors of nuclear cooperation, reviews the history of today’s ongoing debate over uranium enrichment and spent fuel reprocessing (ENR) technologies, and brings attention to near-term political and industry-driven opportunities for both nations. 

Background 

Since the 1950s, the U.S.-South Korean civil nuclear cooperation has evolved from a relationship centered on technical assistance into a mature bilateral partnership between two of the world’s leading nuclear energy producers. The current Section 123 Agreement, which entered into force in 2015, provides the legal framework governing bilateral cooperation on the peaceful uses of civil nuclear technologies. Although the agreement expanded opportunities for collaboration, it left unresolved considerations on South Korea’s interest in domestic uranium enrichment and spent fuel reprocessing (ENR) technologies. To address these issues, the 123 Agreement established mechanisms including the High-Level Bilateral Commission (HLBC) and a Joint Fuel Cycle Study. Progress through these channels has been limited, however.  

At the same time, global nuclear energy markets have changed significantly. Growing electricity demand, decarbonization goals, and the rapid expansion of artificial intelligence (AI) infrastructure are driving renewed investment in nuclear energy. Additionally, recent discussions regarding South Korea’s interest in nuclear-powered submarines (SSNs) add another layer of complexity. Because the current 123 Agreement applies only to peaceful-use nuclear technology, any military-related nuclear cooperation would require separate legal and policy frameworks. As the United States seeks to revitalize its domestic nuclear industry and South Korea pursues enhanced nuclear industry capabilities for SSNs, these developments are creating new incentives—and new challenges—for bilateral nuclear cooperation. 

Policy Recommendations 

Aiming to reaffirm and strengthen the existing 123 Agreement framework, Washington and Seoul should target several key areas of near-term cooperation: 

• Revitalizing and Institutionalizing High-Level Coordination: Washington and Seoul should restart regular high-level working groups whether through the HLBC or a newly designed official coordination body. Renewed institutional engagement would provide a structured forum for addressing unresolved issues, coordinating strategic public-private partnerships, and strengthening communication between government agencies. Reinvigorating these channels would also help rebuild momentum behind the implementation of the 2015 123 Agreement.  

• Expanding Cooperation on AI-driven Nuclear Energy Development: As nuclear energy is reframed as essential for the U.S. national AI agenda, there are timely and important opportunities for the U.S.-South Korean nuclear partnership to play a critical role in the rising AI-nuclear nexus. South Korean firms have already filled a critical gap in U.S. nuclear projects by providing key reactor components, including steam generators and reactor vessels. Washington and Seoul should strengthen industry-to-industry partnerships supporting traditional large-scale reactors, advanced reactors, and small modular reactors (SMRs). Greater industry cooperation will reinforce both countries’ leadership in next-generation nuclear technologies. 

• Strengthening Bilateral Nuclear Fuel Supply Chains: Recent geopolitical disruptions have underscored the importance of reliable nuclear fuel supplies. While both countries are seeking secure sources of fuel for existing and future reactor fleets, South Korea remains dependent on imported enriched uranium. Building on recent commercial agreements, Washington and Seoul should expand cooperation on low-enriched uranium (LEU, LEU+), high-assay low-enriched uranium (HALEU), and advanced fuel production. Strengthened fuel supply partnerships would improve energy security and support long-term nuclear industry growth. 

• Enhancing Collaboration on Spent Fuel Management and Storage: Spent nuclear fuel (SNF) management remains one of the most pressing challenges facing both countries, particularly as South Korea approaches capacity limits for onsite storage at reactor sites. Existing partnerships on dry cask storage and waste management technologies provide a strong foundation for expanded cooperation. The United States and South Korea should prioritize joint development of interim SNF storage solutions, spent fuel management technologies, and long-term disposal strategies. Enhanced collaboration would help address near-term storage challenges while supporting sustainable growth of both countries’ nuclear sectors. 

Conclusion 

Renewed discussions over the future of the U.S.-South Korea 123 Agreement reflects broader changes in the global nuclear landscape. The pursuit of improvements, however, should not overshadow the foundational frameworks currently in place to strengthen the U.S.-South Korean nuclear cooperative partnership in the long run. Moreover, as the political dimensions are readdressed, both sides should not overlook the near-term commercial successes and yet unexplored opportunities that lie ahead for the U.S.-South Korean nuclear partnership. 

By prioritizing AI-driven nuclear development, secure fuel supplies, spent fuel management, and stronger institutional coordination, Washington and Seoul can build a more resilient and future-oriented nuclear partnership. Success will depend not only on government-to-government engagement but also on sustained bilateral collaboration among private-sector industry leaders, academic researchers, and regulators. Future consultations should incorporate public-private partnerships and ensure that industry stakeholders are integrated into bilateral nuclear planning and implementation efforts. A practical, commercially focused approach offers an effective path toward strengthening the bilateral partnership while preserving shared commitments to nuclear safety, security, and nonproliferation. 

Kayla T. Orta is Nonresident Fellow at the Atlantic Council’s Indo-Pacific Security Initiative. All views are the author’s alone.

This material is distributed by KEI on behalf of the Korea Institute for International Economic Policy. Additional information is available at the Department of Justice, Washington, DC.