OpenAI and SoftBank Group are each committing $500 million in equity to SB Energy, while Ares has provided an additional $800 million in redeemable preferred equity. Under the agreement, SB Energy will construct and operate OpenAI's previously announced 1.2 GW data center site in Milam County, Texas.
The transaction establishes a non-exclusive preferred partnership framework rather than a turnkey wholesale arrangement. OpenAI will supply its first-party data center designs and engineering expertise, while SB Energy handles campus construction, facility operations, cost discipline, and integrated energy delivery. SB Energy stated that it is developing multiple multi-gigawatt campuses, with initial facilities under construction and scheduled to begin service starting in 2026. However, the 1.2 GW lease represents contracted development capacity rather than active compute, with operational server halls dependent on phased construction.
To address power and cooling constraints, the companies announced that the Milam County facility will be paired with new energy generation intended to support the site's power needs and protect Texas ratepayers. The facility design also incorporates water-minimization measures. Additionally, the companies pledged investments in local grid modernization, workforce development, and temporary construction jobs during the buildout phase.
The announcement places the partnership within the broader $500 billion Stargate infrastructure initiative. While the deal establishes a framework for multi-gigawatt compute campuses, delivering functional model-training capacity will depend on how quickly SB Energy can build out physical structures, secure hardware, and commission the promised dedicated generation.