Nvidia announced on Monday a significant $1.5 billion investment in SB Energy, a data center operation with ties to SoftBank and OpenAI.
This strategic investment positions Nvidia as the exclusive provider of compute infrastructure for OpenAI's Ports-Pike data center, situated near Cincinnati, Ohio. Furthermore, Nvidia will extend up to $105 billion in credit to facilitate the construction of this facility, which is projected to expand from an initial capacity of 4.25 gigawatts to a substantial 8 gigawatts, as detailed in the company's SEC filings.
SB Energy's current investor base notably includes SoftBank and OpenAI. It's worth noting that SoftBank had previously divested its $5.8 billion stake in Nvidia stock last November, a move undertaken to finance other artificial intelligence ventures.
The data center and power developer plans to construct a 9.2-gigawatt natural gas power plant on the premises. This land, significantly, is owned by the U.S. Department of Energy and historically served as a facility for enriching uranium for both the U.S. nuclear arsenal and U.S. Navy submarines.
The estimated cost for this power plant is a substantial $33 billion. This considerable figure underscores the escalating expenses associated with building natural gas power plants, which have seen a dramatic 66% increase in costs over the past two years, according to data from BloombergNEF.
Upon completion, SB Energy's power plant, alongside others, will enter a competitive landscape for natural gas resources with existing export markets. This convergence of demand could potentially lead to a tripling of natural gas prices in certain regions across the nation.
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