Nvidia commits $1.5 billion to SoftBank-backed data centre project for OpenAI
The investment in SB Energy guarantees Nvidia’s dominance in computing infrastructure for OpenAI’s expanding Ports-Pike site, while highlighting the soaring costs of associated natural gas power generation.
Nvidia has announced a $1.5 billion investment in SB Energy, a data centre developer with ties to SoftBank and OpenAI, cementing its position as the exclusive provider of compute infrastructure for the project. The deal ensures the chipmaker will supply all processing power for OpenAI’s Ports-Pike data centre near Cincinnati, Ohio, as the facility prepares for significant expansion.
According to documents filed with the US Securities and Exchange Commission, Nvidia will also extend up to $105 billion in credit to support the construction of the site. The data centre is expected to scale from an initial capacity of 4.25 gigawatts to 8 gigawatts, reflecting the intensifying demand for artificial intelligence computing resources.
SB Energy, which already counts SoftBank and OpenAI among its investors, plans to construct a 9.2 gigawatt natural gas power plant on the site. The land, owned by the US Department of Energy, was historically used to enrich uranium for the US nuclear arsenal and Navy submarines before being repurposed for modern data infrastructure.
The estimated cost for the new power plant stands at $33 billion, a figure that underscores the rapidly escalating expenses in energy infrastructure. BloombergNEF reports that construction costs for natural gas power plants have surged by 66 per cent over the past two years, driven by supply chain pressures and regulatory requirements.
The financial landscape for the partners involved has also shifted recently. SoftBank previously held $5.8 billion worth of Nvidia stock, which it sold in November to fund other artificial intelligence investments, marking a strategic realignment ahead of this major infrastructure commitment.
Industry analysis suggests that as SB Energy’s power plant and similar facilities come online, they will compete for natural gas supplies with export markets. This convergence of demand could potentially triple natural gas prices in certain regions of the country, although such projections remain contingent on future market conditions and completion timelines.
