OpenAI broadens the Stargate project scope under demand pressure and seeks debt financing for chip purchases.

At the White House this year, OpenAI outlined its "Stargate" infrastructure project that would cost half a trillion dollars and be developed with partners including SoftBank and Oracle. After some fits and starts, OpenAI executives say the joint venture is far more expansive than previously outlined and involves almost everything OpenAI does related to artificial intelligence chips and data centers. Stargate was initially conceived as a new company that would invest $500 billion in AI infrastructure, with the parameters now expanded to include data center projects launched months before Stargate was announced.

The initial vision for Stargate ran into delays due to protracted negotiations with other parties and decisions on locations, according to SoftBank's Chief Financial Officer Yoshimitsu Goto. OpenAI will pursue different creative financing options, some of which have only emerged within the last year, to secure chips for the data centers. A new partnership of up to $100 billion with Nvidia announced on Monday is part of the project, with OpenAI planning to use an initial $10 billion in cash from the chipmaker to secure additional funding. Leasing instead of buying chips could save the company 10-15%, according to a person familiar with the matter. Stargate's projects will not include Microsoft, though OpenAI negotiated terms to enable working with multiple partners.

CEO Sam Altman has repeatedly said that creating data centers is the key to progress. He wrote in a blog that he eventually aimed to get to the point of building a gigawatt of new AI infrastructure every week. At a briefing held at a massive data center in Abilene, Texas, attended by U.S. Senator Ted Cruz and Oracle co-CEO Clay Magouyrk, Altman stated: "We cannot fall behind in the need to put the infrastructure together to make this revolution happen." OpenAI executives have said for years that the company is significantly short on compute required to power its services, especially ChatGPT. Just this week, OpenAI decided to delay launching a product outside the United States due to a lack of compute.

On Tuesday, OpenAI, Oracle and SoftBank unveiled plans for five new U.S. AI data centers for Stargate, including three sites with Oracle, two affiliated with SoftBank, and expansion of an Oracle site in Abilene, Texas. Altogether, OpenAI's projects account for nearly 7 gigawatts of the 10 gigawatts of compute initially envisioned for Stargate. The Abilene flagship project spans 1,100 acres (445 hectares) and has been under construction for more than a year by Oracle and AI startup Crusoe. The site employs thousands of construction workers, with cranes and hydraulic platforms spread across the campus. The facility also includes fiber cable long enough to stretch from the earth to the moon and back.

After announcing Stargate in January, OpenAI held hundreds of meetings across North America with potential partners that could provide land, power and other resources, according to executives. The expanded Stargate plan now includes self-built data centers and third-party cloud capacity, with the new Nvidia deal allowing OpenAI to pay for its chips over time rather than purchasing them outright.