OpenAI partners with SoftBank and Oracle on $500 billion data center project

OpenAI says it will partner with Japanese conglomerate SoftBank and Oracle, among others, to build multiple AI data centers in the United States.

The joint venture, called The Stargate Project, will begin with a large data center project in Texas and eventually expand to other states. The companies plan to initially commit $100 billion to Stargate and invest up to $500 billion in the company over the next four years.

They promise it will create “hundreds of thousands” of jobs and “ensure American leadership in AI.”

“Stargate Project is a new company that intends to (build) new AI infrastructure for OpenAI in the United States,” OpenAI, Oracle and SoftBank said in a joint statement. “This project will not only support the reindustrialization of the United States, but also provide a strategic capability to protect the national security of America and its allies.”

The companies made the announcement during a White House news conference Tuesday, where President Donald Trump discussed his plans to invest in U.S. infrastructure. SoftBank chief Masayoshi Son, OpenAI CEO Sam Altman, and Oracle co-founder Larry Ellison were in attendance.

Microsoft is also involved in Stargate as a technology partner. The same goes for Arm and Nvidia. Middle East AI fund MGX to join SoftBank in investment; MGX’s first public deal was an investment in OpenAI.

SoftBank, OpenAI and Oracle are also listed as “initial investors” in Stargate.

“SoftBank and OpenAI are the lead partners of Stargate, with SoftBank having financial responsibility and OpenAI operational responsibility,” the statement continued. “Masayoshi Son will be the president (of Stargate) (…) As part of Stargate, Oracle, Nvidia and OpenAI will collaborate closely to build and operate this computing system.”

Data centers could one day host chips designed by OpenAI. The company is reportedly aggressively building a team of chip designers and engineers and working with semiconductor companies Broadcom and TSMC to create an AI chip to run models that could arrive as soon as 2026.

SoftBank is already an investor in OpenAI, having committed $500 million in the AI ​​startup’s latest funding round and an additional $1.5 billion to allow OpenAI staff to sell shares as part of a public purchase offer. Oracle, meanwhile, has an ongoing agreement with OpenAI to provide computing resources for AI.

Softbank also committed to investing $100 billion in the United States over the next four years. Son and Trump have had a close working relationship since 2016, during Trump’s first term, when Son announced that SoftBank would invest $50 billion in U.S. startups and create 50,000 jobs.

The Information previously reported that OpenAI was negotiating with Oracle to lease a full data center in Abilene, Texas – one that could reach nearly a gigawatt of power by mid-2026. (One gigawatt is enough to power about 750,000 small homes.) Data center startup Crusoe Energy would be involved in the project, which was estimated to cost about $3.4 billion.

This Abilene site will be Stargate’s first location, and OpenAI says Stargate is “evaluating potential sites across the country for more campuses as it finalizes definitive agreements.”

It’s unclear what connection, if any, Stargate has to a rumored partnership between Microsoft and OpenAI to power a $100 billion supercomputer. TechCrunch has contacted OpenAI for additional information.

Last year, The Information reported that Microsoft and OpenAI would build a series of AI data centers starting in five stages over the next few years, culminating in Stargate: a 5-gigawatt facility spanning several hundreds of acres of land. Stargate is expected to take between five and six years to complete, according to The Information. Before its completion, Microsoft reportedly planned to launch a smaller data center for OpenAI around 2026.

A number of technology leaders have called for the United States to increase its investment in data centers, especially as the AI ​​sector continues to grow at an explosive rate. AI systems require huge banks of servers to develop and operate at scale.

Goldman Sachs estimates that AI will account for about 19% of data center energy demand by 2028. OpenAI has blamed the lag in its products on a lack of available computing resources, with computing capacity reportedly becoming a source tensions between the AI ​​company and Microsoft, its close collaborator and major investor.

Microsoft, which recently announced it was set to spend $80 billion on AI data centers, said in a recent blog post that the company’s success depends on “new partnerships built on large-scale infrastructure investments. In an interview with Bloomberg, Altman said he believes there is an urgent need to remove what he perceives as barriers to building additional data center infrastructure in the United States.

“What I deeply agree with (President Trump) is that it is incredibly difficult to build things in the United States,” Altman said in that interview. “Power plants, data centers, all that kind of stuff. I understand how much bureaucracy builds up, but it doesn’t benefit the country in general.”

Massive data center projects draw strong criticism, saying data centers often create fewer jobs than promised and tend to have serious environmental impacts. Data centers are typically water-intensive, putting a strain on regions with insufficient water resources, and their high energy requirements have forced some utilities to rely heavily on fossil fuels.

These concerns do not appear to be slowing investment. According to a McKinsey report, capital spending on purchasing and installing mechanical and electrical systems for data centers could exceed $250 billion over the next five years.

In January, Trump announced that Hussain Sajwani, a billionaire Emirati businessman who founded real estate development giant DAMAC Properties, would invest $20 billion in new data centers in the United States. Industry insiders, however, expressed skepticism about the concreteness of the deal.