OpenAI plans to invest roughly US$400 billion to develop five new US data centre sites in partnership with Oracle Corp and SoftBank Group Corp, marking the biggest push yet to fulfill an earlier pledge to spend a half-trillion dollars on artificial intelligence infrastructure in the country.
The new locations, spread across Texas, New Mexico and Ohio, will eventually have a capacity of 7 gigawatts of power, or as much as some cities, the companies said Tuesday. The plans were announced by executives from the three tech firms at a press conference in Abilene, Texas, where OpenAI and Oracle have for months been developing the first data centre branded as part of Stargate, the joint AI infrastructure initiative.
The expansion brings the companies significantly closer to their goal of investing US$500 billion in domestic data centres and AI infrastructure over the next four years — a pledge made by their top executives in the first days after President Donald Trump’s return to the White House. The added facilities are also poised to provide substantially more computing capacity to support OpenAI’s services, including ChatGPT, which is now used by 700 million people weekly.
“We will push on infrastructure as hard as we can because that is what will drive our ability to deliver amazing technology and basic products and services,” OpenAI Chief Executive Officer Sam Altman said at the press conference.
Three of the new sites — in Shackelford County, Texas; Dona Ana County, New Mexico; and an undisclosed location in the Midwest — will be developed in partnership with Oracle for more than 5.5 GW of total capacity, including an additional 600 megawatt expansion at a site near the original Abilene location. OpenAI previously entered an agreement with Oracle in July to develop up to 4.5 gigawatts of additional Stargate capacity, representing about US$300 billion of the newly announced US$400 billion commitment.
“The work that we have to do is not possible for any one entity, for any one company, to do on its own,” said Clay Magouyrk, the newly named co-CEO of Oracle. “We couldn’t do this by ourselves. It’s a collaboration between SoftBank and OpenAI and Oracle and others.”
See also: Bank of Singapore uses AI agents to cut source of wealth report time to one hour
The other two sites in Lordstown, Ohio, and Milam County, Texas, will be developed with SoftBank for an initial total of 1.5 gigawatts of capacity over the next 18 months, marking SoftBank’s first co-development project as part of Stargate. (A single gigawatt is akin to the capacity of one nuclear reactor.) OpenAI said the Texas facility will be developed in partnership with SoftBank-backed SB Energy to provide power for the location. The Ohio location is expected to be operational by next year, OpenAI said.
The Stargate venture was initially announced as an LLC with OpenAI, SoftBank and others listed as equity partners. Since then, OpenAI has expanded Stargate to include agreements for data centre deals made outside of the LLC with Oracle and other providers. It has also broadened the Stargate brand beyond the US to regions such as Europe and the Middle East.
SoftBank has taken longer than expected to get its own Stargate projects off the ground, as Bloomberg News reported in May and SoftBank’s chief financial officer acknowledged last month. At the press conference, the company said it’s breaking ground on the Milam site, in addition to the Ohio location that’s already under development.
See also: The babble about a looming AI bubble
The new Stargate sites will be financed with a mixture of cash and debt, according to OpenAI executives involved in the effort. OpenAI believes a new US$100 billion investment deal with Nvidia Corp. will make it easier for the ChatGPT maker to secure debt financing, said the executives, who requested anonymity to discuss internal matters.
“I don’t think we figured out yet the final form of what financing for compute looks like,” Altman said.
OpenAI is one of several tech companies investing heavily to expand its data centre footprint in the US and abroad in order to support AI development. Meta Platforms Inc, Alphabet Inc, Amazon.com Inc and Microsoft Corp are expected to spend more than US$344 billion for the year, with much of that going toward data centres necessary to run AI models.
At the same time, there have been growing concerns that the AI spending surge could contribute to a market bubble, not unlike the dot-com bubble of 25 years ago. Altman himself has acknowledged there are signs of a bubble while professing his long-term belief in the technology. The OpenAI CEO has also said he wants to spend “trillions” on AI infrastructure.
OpenAI said the new Stargate sites would create tens of thousands of additional jobs across the US. The company also said it continues to evaluate additional locations for further data centre expansion.
"We’ll always be in a compute constrained world, but we never want to be this compute constrained again,” Altman said.
