Major Power Agreement for AI Infrastructure
Central Puerto, one of Argentina‘s largest power producers, has signed a Memorandum of Understanding to supply electricity for a portion of OpenAI‘s planned Stargate Argentina project, according to reports from Bloomberg. The agreement marks a significant step forward for the $25 billion data center initiative announced earlier this month by the Argentine government.
Hydroelectric Power Source
Sources indicate the power producer would likely supply electricity to the massive project via hydroelectric dams. According to the company’s website, Central Puerto operates 14 power plants across Argentina with a total installed capacity of 6.7GW, including the 1.44GW Piedra del Águila Hydroelectric Plant on the Limay River in northwestern Patagonia. Analysts suggest it remains unclear which specific plant would serve the data center facility.
Project Timeline and Capacity
The report states that construction on Stargate Argentina is expected to begin next year, with the first 100MW phase reportedly launching in 2027. At full build-out, the data center is projected to reach up to 500MW capacity, making it one of the largest AI computing facilities in South America. The project will be located somewhere in Argentina’s southern Patagonia region, though exact details remain scarce.
Multiple Energy Partnerships
According to reports, renewable energy firm Sur Energy previously inked a Letter of Intent to supply power to the large-scale data center. Local press have indicated the data center will be completed via a joint venture between Sur Energy and an unnamed ‘leading cloud infrastructure developer,’ supported by a power purchase agreement from OpenAI. This dual-energy provider approach suggests the project’s substantial power requirements.
Government Incentive Framework
The deal is reportedly structured under the RIGI framework, an Argentinian government-backed incentive scheme designed to attract large-scale investment into the country. This comes amid other major international infrastructure developments, including the US arranging $20 billion private finance facility for global projects and the perovskite solar breakthrough nearing commercial reality.
OpenAI’s Global Expansion
Following the initial announcement, OpenAI CEO Sam Altman stated, “We are proud to announce plans to launch Stargate Argentina, an exciting new infrastructure project in partnership with one of the country’s leading energy companies, Sur Energy.” The Stargate initiative was launched by OpenAI in January in partnership with SoftBank, Oracle, and Abu Dhabi’s MGX, with partners claiming at the time that the project would involve investments of up to $500 billion in digital infrastructure in the US over the next four years.
International Data Center Network
Since the initial Texas project reached operational status last month, OpenAI has announced plans for Stargate data centers in multiple countries, including the UK, Norway, South Korea, and Germany. Reports suggest more facilities are in development in Canada and India, creating a global network of AI computing infrastructure. This expansion coincides with other international developments, including the UK government denying Cummings’ claims of China breach and the London Capital Finance administrators pursuing legal action.
Strategic Importance
Analysts suggest the Argentina location offers significant advantages for large-scale computing operations, including access to renewable energy sources and favorable climate conditions for cooling requirements. The project represents one of the largest foreign investments in Argentina’s technology infrastructure and could position the country as a key player in the global AI computing landscape.
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