(Bloomberg) — OpenAI is helping to develop a major data center in the United Arab Emirates, a big overseas expansion of its Stargate effort to build out AI infrastructure.
The ChatGPT maker is partnering on a 5 GW data center cluster in Abu Dhabi with G42, an AI company backed by the country’s sovereign wealth fund. As part of the deal, G42 plans to make a reciprocal dollar-for-dollar investment in AI infrastructure in the US, OpenAI said.
The UAE data center complex, which is far larger than any site OpenAI or its closest rivals have announced to date, may extend the reach of US-designed AI software abroad. But the agreement with G42, a company with historic ties to China, is also spurring concerns over the proliferation of cutting-edge AI hardware and its implications for American technological strength and national security.
“By establishing the world’s first Stargate outside of the US in the UAE, we’re transforming a bold vision into reality,” OpenAI Chief Executive Officer Sam Altman said in a statement. “It’s a step toward ensuring some of this era’s most important breakthroughs – safer medicines, personalized learning and modernized energy – can emerge from more places and benefit the world.”
In a joint press release, G42 chief Peng Xiao hailed the project as “a significant step in the UAE–US AI partnership.”
Once completed, the facility would span around 10 square miles, with estimated power needs roughly equivalent to the generation capacity of five nuclear power plants. Its 5 GW capacity dwarfs the 1.2 GW projected capacity of the first Stargate campus in the US in Abilene, Texas. That domestic push, announced by President Donald Trump in January, targets investments of around $500 billion in US projects over the next four years, with backing from OpenAI, SoftBank Group Corporation, Oracle Corporation, and Abu Dhabi AI fund MGX.
It remains unclear where the entire 5 GW – or 5,000 MW – of electricity for the facility will come from. OpenAI’s chief global affairs officer, Chris Lehane, acknowledged that it would likely need to be developed “in a series of stages.” There is about 200 MW coming online over the course of the next year, he said in an interview with Bloomberg TV on Thursday.
SoftBank and Oracle are also partners in the Emirati data center project, alongside Nvidia Corp. and Cisco Systems. The developers will first work on a 1 GW data center cluster, of which 200 MW will go online in 2026. As part of the partnership, the UAE will pay for ChatGPT Plus subscriptions for all its residents, as well as integrate the tool across government agencies and in areas such as energy and health care.
OpenAI will eventually use 1 GW of the Abu Dhabi project’s total computing power, and other companies may also participate, it said.
But some officials in the Trump administration are worried about the strategic implications of what they consider an offshoring of American AI capabilities. The officials have also raised national security concerns about sharing advanced US semiconductors, the gold standard for developing and training AI models, with companies and countries that have deep China ties.
Many of those worries center around G42, which had close ties with Chinese telecom powerhouse Huawei Technologies Company for much of its history.
The Abu Dhabi company promised to divest from Huawei and other Chinese companies last year to pave the way for a $1.5 billion partnership with Microsoft. That deal was underpinned by a so-called intergovernmental assurance agreement, which spelled out specific national security provisions to prevent US technology from benefiting Beijing.
Some officials in Washington remain skeptical that G42 will hold up its end of the deal, despite repeated assurances from the company and Emirati officials.
Asked whether the OpenAI partnership includes a national-security accord similar to the Microsoft deal, a person familiar with the plans did not answer directly.
Instead, they highlighted the fact that all advanced chip shipments to the UAE need a US government license – a requirement that’s been in place since 2023 to prevent diversion of those chips to China. China hawks in Washington view that approval process as a key step for vetting major AI deals announced during Trump’s trip to the Gulf.
Washington and Abu Dhabi are also hashing out a bilateral AI agreement, which includes high-level measures to prevent diversion of physical hardware to China and to stop Chinese AI companies from training models on US-powered data centers in the UAE. Officials will hammer out the details of that accord in a working group.
