Nvidia is in talks to provide around $250 billion in financial backing for OpenAI as part of a massive data centre project, The Wall Street Journal reported on Sunday.
The proposed guarantees from Nvidia could help the ChatGPT maker lease a 10-gigawatt data centre project being developed by SoftBank’s energy subsidiary in southern Ohio, the newspaper reported, citing people familiar with the matter.
The project is expected to be a major part of OpenAI’s plans to secure the huge amount of computing power needed to run its artificial intelligence systems.
Nvidia in talks to back $250 billion OpenAI data centre project in Ohio
According to WSJ, the full project could cost more than $500 billion when the cost of the Nvidia chips that will power the data centres is included. If completed, it would be the largest data centre project announced so far.
The project’s power is controlled by the US government and is being funded separately by Japan under a recent trade agreement. US Commerce Secretary Howard Lutnick is involved in deciding which company will get access to the power, sources told the newspaper.
AI companies are under growing pressure to secure the huge amounts of chips and electricity needed to run their AI models. This has made large projects with government support or guaranteed access to power increasingly attractive.
Nvidia backing could make borrowing easier
Nvidia’s financial support would help the data centre developer raise money on better terms than it could otherwise get. The developer is owned by SoftBank, the investment firm controlled by Japanese billionaire Masayoshi Son. OpenAI, meanwhile, does not have an investment-grade credit rating because it is still an unprofitable private company.
The Nvidia guarantee could therefore give lenders more confidence that the project has strong financial backing.
OpenAI has been in advanced talks for several weeks to lease the site, WSJ reported. It is among the companies that have shown the strongest interest in the project. Anthropic, Microsoft and Google have also spoken to Lutnick about the site in recent weeks, one of the people said.
Under the proposed arrangement, Nvidia would guarantee a series of financing vehicles. However, the terms have not been finalised, and the deal could still fall apart.
The proposed $250 billion guarantee would cover the cost of OpenAI‘s data centre lease and the debt needed to build the project. It would not cover the Nvidia chips that would be installed inside the data centres.
First phase expected to be ready in 2028
The project is expected to take many years to complete. The first phase is expected to be ready in 2028 and would have around 800 megawatts of power, according to people familiar with the deal.
The project is also important for Lutnick and the Trump administration. As part of Japan’s commitment to invest in the US in exchange for lower tariffs, Japan agreed to put $33 billion into a natural-gas power project on federal land in Ohio. The project would be operated by SoftBank Energy
The project is being built on federal land at a former uranium-enrichment site around 50 miles south of Columbus. By using federal land, the US government and its partners hope to avoid some of the long permitting processes and local opposition that have delayed data centre projects in other parts of the country.
However, the project will still need time to finalise its financing and secure all the equipment required for construction.
The arrangement is another example of how the Trump administration is trying to speed up investment in important industries by working directly with private companies.
Big tech companies are helping fund AI infrastructure
The proposed deal also highlights a major change in the way huge AI infrastructure projects are being financed. Large technology companies with strong credit ratings are using their own balance sheets to help smaller companies borrow money for infrastructure projects.
Google, for example, has backed some data centres for Anthropic. The move also helps Google increase sales of its own AI chips, known as tensor processing units, or TPUs.
For OpenAI, the Ohio project would be its first data centre as a tenant. It would bring the company closer to having greater control over the infrastructure it needs to run its AI models.
Nvidia also wants to secure future chip demand
OpenAI and Anthropic are both racing towards possible IPOs at extremely high valuations. That is putting even more pressure on the companies to keep growing rapidly.
Nvidia, meanwhile, has a market value of around $5 trillion and is working to secure strong demand for its chips as AI development continues.
The company itself has warned about the risks linked to financing arrangements involving data centres.
In its latest annual report, Nvidia said such arrangements could reduce its cash flows in the near term and increase its exposure to credit risks from customers.
