Oracle Corporation (ORCL.US) and OpenAI have abandoned their plans to expand the Texas AI data center, and Meta (META.US) may take over the lease.

On Friday, sources familiar with the matter revealed that Oracle Corporation (ORCL.US) and OpenAI have abandoned plans to expand a large artificial intelligence data center in Texas, USA. The reason for this decision was the continued delays in negotiations over financing arrangements and OpenAI's evolving computing power needs. This change has provided an opportunity for Meta Platforms (META.US), which is considering leasing the expansion portion of the project. According to sources, Meta is currently in negotiations with the project developer Crusoe to lease the expanded data center located in Abilene, Texas. AI chip giant NVIDIA Corporation (NVDA.US) played an important role in facilitating contacts between Meta and the developer to ensure that the future expanded data center continues to use its AI chip products, rather than the solutions of its competitor AMD (AMD.US). This adjustment highlights the complexity of building super large AI data centers. Such projects typically involve investments of up to several billion dollars and require extensive cooperation between developers, cloud service providers, chip suppliers, and customers. The Abilene data center park is part of the highly anticipated "Stargate" project. The project was announced last year at the White House by former President Trump and covers an area of approximately 1000 acres. The park is still under construction, with some facilities already operational. However, Oracle Corporation and OpenAI have ultimately decided not to proceed with the previously discussed expansion plans. Previously, the two parties planned to increase the data center capacity from 1.2 gigawatts to approximately 2.0 gigawatts. Gigawatt-scale data centers are extremely large, with one gigawatt of power equivalent to the generating capacity of a nuclear reactor, providing power to approximately 750,000 households simultaneously. The reasons cited for the breakdown in negotiations included complex financing arrangements and OpenAI's frequent changes in computing power requirements. In addition, the data center had experienced shutdowns for several days due to liquid cooling equipment being affected by winter weather, further exacerbating the tension between Oracle Corporation and Crusoe. Nevertheless, both parties have stated that their partnership remains strong. In a statement, Oracle Corporation expressed pride in its collaboration with Crusoe and the progress of the project, while Crusoe stated that they were jointly building one of the world's largest AI computing infrastructure. Meanwhile, NVIDIA Corporation has paid a $150 million deposit to Crusoe to ensure that its chips continue to be used for the project and has assisted in promoting Meta as a potential tenant for the expansion project. It is worth noting that the collaboration between Oracle Corporation and OpenAI has not been adversely affected overall. Last July, Oracle Corporation agreed to develop a 4.5-gigawatt data center capacity for OpenAI, and the related project is still ongoing, including other data center projects near Detroit. With the increasing demand for computing power for training and deploying AI models, the global data center construction is entering an unprecedented expansion period. Social media giant Meta is heavily investing in AI infrastructure, with capital expenditures projected to reach as high as $135 billion by 2026. The company is currently building large data centers in Louisiana and Indiana and signed an agreement last month to deploy 6-gigawatt scale AMD equipment. As a result of this news, Oracle Corporation's stock price fell by 1.18% to $152.96 at the close on Friday. Companies related to AI infrastructure construction, including CoreWeave, AMD, and NVIDIA Corporation, also experienced declines in their stock prices. (Note: This is a translation and may not be perfect, please consult with a professional for accurate information)