Open AI targets Argentina's freezing Patagonia for $25 billion 500MW Stargate AI data center — Green Capital and Flex Domes prep 120 to 3,000MW wind-powered server farms to skirt US backlash | Tech Radar
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Open AI targets Argentina's freezing Patagonia for $25 billion 500MW Stargate AI data center — Green Capital and Flex Domes prep 120 to 3,000MW wind-powered server farms to skirt US backlash
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Open AI is leading the race to “quietly” open a data center in the Patagonia region of Argentina
Argentine energy giant Pampa Energia is in talks to develop a 500 megawatt data center site
The Loma de la Lata thermal power plant would provide the data center’s electricity, burning gas from the nearby Vaca Muerta shale gas formation
Open AI is among several cloud and AI computing companies looking at Argentina’s Patagonia region as a possible location for fuss-free, opposition-avoiding data centers. Supported by low temperatures to aid cooling, and a clean energy source, a suitable site is currently being explored, following Open AI signing a letter of intent with Sur Energy in 2025.
The Open AI-Sur Energy partnership appears to have sparked growing attention on Patagonia, where other major hyperscalers are also said to have shown interest -- these include Google and Apple.
Widespread opposition to data centers in the US have prompted companies like Open AI, Google, Apple, and Meta to look elsewhere to develop their cloud and AI facilities. However, communications limitations may prove difficult to overcome, and there is uncertainty about Pres. Javier Milei’s long-term future, factors which may explain Open AI’s slow pace on the project.
While Open AI and Sur Energy initially formalised their collaboration with a letter of intent in October 2025, there seems to have been little movement toward selecting a site, let alone breaking ground.
Sur Energy and Pampa Energia are not direct competitors. Rather, Pampa Energia is a large independent energy company, whereas Sur Energy is a specialized developer within the energy industry. Both organizations would typically be involved with the development of a data center in Patagonia, whether Open AI’s Stargate Argentina or a rival build. Similarly, many other companies could be involved. For example, Flex Domes is reportly looking for investors into a data center in Patagonia.
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Developments in Patagonia may not be limited to the energy from the Vaca Muerta shale field. Hydroelectric may be selected as an alternative; elsewhere, Green Capital is looking at wind and solar farms for a possible site in the Chubut province.
However, whether Sur Energy provides the Open AI plant with energy or Pampa Energia successfully attracts a data center from a rival cloud AI company, there remains a couple of key challenges.
While Argentina offers tax breaks and regulatory stability with its investor-pleasing RIGI incentives, shale gas energy, and minimal resistance to large projects with an ecological impact, it does not currently have the data links required to make a modern data center viable. That requires considerable investment in upgrading and (for large areas) installing fiber links.
But there is another potential challenge to establishing a data center in Patagonia. Less “anti-data-center” and more “anti-development,” the local area is occupied by the Mapuche Indigenous families, who have previously sued oil giant Exxon, French company Total, and BP-owned Pan American Energy for contracting an Argentine company that dumped waste illegally. Switching data center development to Argentina may have more attractive power and cooling options, but it is not without challenges for Open AI and its competitors.
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Christian Cawley has extensive experience as a writer and editor in consumer electronics, IT and entertainment media. He has contributed to Tech Radar since 2017 and has been published in Computer Weekly, Linux Format, Computer Active, and other publications.
He currently heads up the team at smart home website Matter Alpha, and writes about retro gaming at Gaming Retro.
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