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Patagonia draws AI data center plans, including a 500 megawatt site

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Patagonia draws AI data center plans, including a 500 megawatt site

Argentina's Patagonia region is drawing interest as a site for large AI data centers, according to a Reuters report. The appeal is a cool climate, hydropower and wind energy, shale gas from the Vaca Muerta formation, and plenty of empty land.

Power producer Pampa Energía plans a facility of up to 500 megawatts in Neuquén province and is looking for investors, with the first contracts expected by the end of 2026. Interested parties want to start with 20 to 40 megawatts. Grid infrastructure for the full build-out alone would cost around $900 million.

Polish company Green Capital wants to start with 300 megawatts in Chubut province, with 3,000 megawatts planned over the long term. Separately, OpenAI announced a project with Sur Energy back in October, but that deal has not been signed yet.

Unlike in the United States, there has been no organized pushback against server farms in Argentina so far, because the country barely has any large facilities yet. That could change: Pampa wants to build next to its Loma de la Lata power plant, where Indigenous Mapuche families live and have clashed with energy companies before. Grid connection, undersea cables, and how stable investment conditions remain after the 2027 presidential election are also open questions.

Key facts

  • Pampa Energía plans a facility of up to 500 megawatts in Neuquén province, starting with 20 to 40 megawatts, with first investor contracts expected by the end of 2026.
  • Grid infrastructure for the full 500 megawatt build-out would cost around $900 million.
  • Polish company Green Capital wants to start with 300 megawatts in Chubut province, with 3,000 megawatts planned over the long term.
  • OpenAI announced a project with Sur Energy back in October, but it has not been signed yet.
  • Unlike in the US, there has been no pushback against server farms in Argentina so far, but Pampa's planned site sits near Indigenous Mapuche families who have clashed with energy companies before.

Why it matters

Patagonia is positioning itself as a new frontier for AI compute at a moment when power availability, not chip supply, is the binding constraint on data center growth. Cool air for cooling, hydro and wind generation, shale gas from Vaca Muerta, and cheap, empty land make the region attractive to builders who are running into grid limits and permitting fights elsewhere.

Who it affects

Pampa Energía and Green Capital, the two power producers sketching multi-hundred-megawatt sites in Neuquén and Chubut; OpenAI and Sur Energy, whose announced project is still unsigned; investors being courted for contracts due by the end of 2026; and Indigenous Mapuche families living near Pampa's planned Loma de la Lata site, who have clashed with energy companies before.

How to use it

For anyone evaluating the region, the near-term numbers are Pampa's initial 20 to 40 megawatt phase ahead of a possible 500 megawatt build-out, its roughly $900 million grid infrastructure cost, and Green Capital's 300 megawatt starting phase in Chubut against a long-term 3,000 megawatt plan. None of these projects, including OpenAI's, are confirmed as signed yet.

How solid is it

The account rests on a Reuters report relayed by The Decoder, with specific megawatt and dollar figures attributed to named companies. The OpenAI and Sur Energy item is explicitly flagged as announced but unsigned, and no timeline is given for when Green Capital's long-term 3,000 megawatt target would be reached, so the region's pipeline is still plans and announcements rather than construction underway.

Risks and caveats

The OpenAI-Sur Energy project could still fall through since it remains unsigned. Grid connection and undersea cable questions are unresolved, and Argentina's 2027 presidential election is cited as a factor for how stable investment conditions will be. The article also notes that the current absence of pushback may not last: Pampa's planned site is near Mapuche families who have a history of conflict with energy companies, echoing the community resistance that has slowed data center projects in the US.