OpenAI and NextDC Announce Joint Plan for Large-Scale Data Center Development in Sydney

OpenAI and Australian data center operator NextDC Ltd. have announced plans to build a large-scale computing cluster in Sydney. The project is valued at A$7 billion (approximately $4.6 billion) and marks a significant expansion of OpenAI’s infrastructure in the Asia-Pacific region.

The partnership aims to accelerate AI capabilities by establishing a state-of-the-art data center specializing in supporting complex machine learning workloads. NextDC confirmed this facility is a crucial element in their broader collaboration to enhance AI infrastructure across Australia.

The new data center is expected to be operational by the second half of 2027. During this timeframe, OpenAI is simultaneously launching its first office in Australia, reinforcing its commitment to the local market. This development aligns with Australia’s ongoing sovereign AI initiatives aimed at boosting technological self-reliance.

This collaboration has already had a positive impact on NextDC’s market performance, with the company’s stock price rising by up to 11% following the announcement. Analysts see this as a lucrative long-term investment given the rising demand for AI-driven computing power worldwide.

Key details of the project include:

1. Location: Sydney, Australia
2. Investment: A$7 billion (approx. $4.6 billion)
3. Operational target: Second half of 2027
4. Partnership scope: Large-scale AI infrastructure and computing cluster
5. Strategic significance: Support for OpenAI’s growth and Australian AI sovereignty

NextDC’s CEO highlighted that the infrastructure will serve as a backbone for AI innovation, supporting OpenAI’s expanding suite of products and services. By integrating cutting-edge technology and high-density computing capacity, the initiative aims to meet escalating processing demands efficiently and sustainably.

OpenAI’s move into the Australian market is expected to foster regional technology development while creating jobs and reinforcing Sydney’s position as a growing hub for digital innovation and cloud computing services. As AI continues to surge globally, partnerships like this are crucial for maintaining competitive advantage and technological leadership.