March 6 (Reuters) – Oracle and OpenAI have abandoned plans to expand a flagship artificial intelligence data center in Texas after negotiations dragged over financing and OpenAI’s changing needs, Bloomberg News reported on Friday, citing people familiar with the matter.
The plan is part of the Stargate project, a joint venture between SoftBank Group , OpenAI and Oracle . The project was announced in January by U.S. President Donald Trump, who said the companies would invest up to $500 billion to fund infrastructure for AI.
Technology companies have been pouring billions of dollars into data centers to power generative AI services such as ChatGPT and Copilot that require huge amounts of computing power.
Although construction of the site is ongoing and parts of it are operational, Oracle and OpenAI have decided against moving forward with tentative plans to lease a large expansion, the report said.
The collapsed talks created an opening for Meta Platforms to step in and consider leasing the planned expansion site in Abilene, Texas, from developer Crusoe, according to the report. Nvidia helped facilitate the discussions.
Oracle and OpenAI are using Nvidia’s AI semiconductors at the Stargate site, and the chip designer stepped in to make sure its products, rather than those of competitor Advanced Micro Devices, would be used to power the expanded data center, Bloomberg News reported.
OpenAI and Oracle announced plans to develop another 4.5 gigawatts of data center capacity in July and that deal remains on track, the report said.
Meta declined to comment when contacted by Reuters. Oracle, OpenAI and Nvidia did not immediately respond to requests for comment.
In September, OpenAI, Oracle and SoftBank had unveiled plans for five new U.S. AI data centers for Stargate. These include three sites with Oracle, two affiliated with SoftBank and an expansion of the Oracle site in Abilene.
(Reporting by Juby Babu in Mexico City; Editing by Tasim Zahid and Sahal Muhammed)
