A day after becoming President, Donald Trump announced the Stargate Project, a multinational joint venture that plans on investing $500 billion to build ten AI data centres in Texas. The announcement of Stargate followed Trump’s rescinding President Biden’s executive order on AI, which aimed to increase safeguards for the technology.

The venture comprises a number of multinational companies, with funding from Japanese investment house Softbank, Abu Dhabi sovereign wealth fund MGX, and US technology firms Oracle and OpenAI. The venture is launching with an initial investment of $100 billion. The owners of the venture comprise OpenAI, SoftBank, Oracle and MGX. The key technology partners for the venture are ARM, Microsoft, Nvidia, Oracle, and OpenAI.

The US Government is not committing money to the private venture. However President Trump committed during the January 21 announcement in the White House to using presidential executive orders to help build the venture’s infrastructure. This is likely to involve the construction of new electricity infrastructure and generation capacity. It is also likely to involve the construction of new water infrastructure for the data centres.

According to US public broadcaster NPR, the average data centre uses around 300,000 gallons of water daily for cooling. The envisaged Stargate data centres are likely to be far larger, more power hungry, and generate far more heat. In particular, they are likely to have a greater number of GPUs, which generate more heat and consume more energy than CPUs, sometimes ten times as much.

The first ten AI data centres will be built in Abilene, Texas. Despite the proximity of a number of lakes and reservoirs, Abilene has a long history of water shortages and droughts. The city suffers from low water tables, and has imposed water conservation measures and restricted use of water by residents.

Obtaining the energy capacity and grid infrastructure as well as fresh dedicated supplies of water for cooling will be a major challenge for the Stargate venture. Access to presidential executive orders to help clear regulatory and building permission hurdles could significantly cut cost and time to get the data centres operational.

The venture launched with an initial investment of $100 billion. By 2029, the venture has committed to increasing this to $500 billion. Softbank and OpenAI have committed $19 billion of initial funding, and hold 40% of shares each. Oracle and MGX are both committing $7 billion each.

From a public policy perspective, the largest initial impact of the venture will be on roll-out of new energy capacity, and possible changes to planning and regulation of construction, energy grid and water supply infrastructure.

In a discussion hosted by the IEEE following the announcement, participants were concerned that sufficient energy and water capacity could be made available. The clustering of ten major hyperscale AI data centres in one location in Texas is likely to further stress construction and operational efforts. The IEEE also pointed to the cancellation of energy projects and withdrawal of funding for energy modernisation programmes by the Trump administration on its first day in office.

According to a report by the Financial Times newspaper, the infrastructure that will be built as part of the Stargate programme will be reserved exclusively to OpenAI.