SK Hynix has announced plans to invest $12.85 billion in an advanced packaging manufacturing plant in South Korea.

Construction of the fab, dubbed P&T7, will begin later this month.

The facility will sit on a 230,000 sqm (2.48 million sq ft) parcel of land within the Cheongju Technopolis Industrial Complex. According to SK Hynix, it will feature three floors of wafer-level packaging (WLP) process lines across 60,000 sqm (646,000 sq ft) and seven floors of wafer test (WT) process lines across 90,000 sqm (968,751 sq ft). The cleanroom area alone will total 150,000 sqm (1.61 million sq ft), the company added.

The WT line is slated for completion by October 2027, with the WLP line expected to follow in February 2028. P&T7 is the fifth production facility the company is building in Cheongju, following M11, M12, M15, and M15X.

SK Hynix said during the construction phase, an average of 320 workers will be deployed on site, although that figure could increase to 9,000 at peak times. Once completed, the facility will employ around 3,000 workers.

“P&T7 is the core production base that will complete SK Hynix’s AI memory leadership,” said Byeonggi Lee, head of manufacturing at SK Hynix. “We will focus our manufacturing capabilities to ensure that the advanced products manufactured here set the standard for global AI infrastructure, while closely engaging with the local community to build a successful business model that captures both national industrial competitiveness and shared growth with the region.”

SK Hynix had previously warned that the current memory chip shortage would continue into 2027, with consumer electronics likely to suffer the most in the face of ongoing supply issues, as capacity will increasingly become allocated to AI infrastructure projects.

However, speaking to reporters at Nvidia’s GTC event in San Jose, California, last week, SK Group chairman Chey Tae-won revised that prediction, saying the shortage is now likely to persist until 2030, with the company expecting to see a wafer shortage of more than 20 percent.

Last month, it was reported that the company would spend $7.97bn to acquire an extreme ultraviolet (EUV) ​scanner from ASML. The scanner will be delivered by December 2027 and will be used by SK Hynix to expand its production of memory chips.