OpenAI's massive Stargate data center canceled as firm can't reach terms with Oracle, operator struggles with reliability issues — Meta said to be interested in snatching excess capacity

Source: Tom’s Hardware

Image credit: Oracle

Cancellation of Expansion

Oracle and OpenAI have cancelled plans to expand their flagship AI data center campus in Abilene, Texas, after lengthy negotiations broke down over financing arrangements and OpenAI’s changing capacity projections, reports Bloomberg. The Abilene campus is part of the Stargate project announced at the White House last year and now faces slowdowns.

Background

Since mid‑2025, Oracle, Crusoe, and OpenAI discussed increasing data‑center power capacity from about 1.2 GW to roughly 2.0 GW, amid local reluctance. Negotiations became complicated due to difficult financing terms and OpenAI’s shifting capacity forecasts, leading to the collapse of the expansion plan, according to Bloomberg.

Despite the cancellation, development of the 1,000‑acre campus continues, and multiple facilities are already in service. Preliminary agreements to rent a substantial expansion were ultimately dropped.

Reliability Issues

The Abilene campus is one of the largest AI data‑center projects announced so far and hosts Nvidia‑based servers used by OpenAI. Relations between Oracle and Crusoe have been strained by reliability problems:

• Earlier this year, winter weather disrupted parts of the liquid‑cooling infrastructure, forcing several buildings offline for multiple days.
• Both companies say cooperation remains strong and development continues, but the source report notes these hiccups.

Potential Meta Involvement

With the expansion shelved, Crusoe began searching for another tenant. Nvidia reportedly stepped in to help ensure the site continues deploying its hardware rather than AMD‑based systems. Nvidia provided Crusoe with a $150 million deposit and assisted efforts to attract Meta—as a prospective tenant for the additional capacity. Meta has not yet confirmed any expansion at the Abilene campus.

Overall Partnership

Despite shelving the expansion of this Stargate project, Oracle’s broader partnership with OpenAI remains unchanged. In July of the previous year, Oracle agreed to develop 4.5 GW of data‑center capacity for OpenAI, and that program continues. The companies have also announced projects in other locations, including a site near Detroit owned by Related Digital.

Note: One gigawatt is comparable to the output of a nuclear reactor and can supply electricity to hundreds of thousands of homes at peak usage. A nuclear power plant was not reported to be part of the negotiations, which may explain local opposition to increasing power capacity with coal or gas generators.