Nvidia to provide $105 billion guarantee for OpenAI Ohio data center

Nvidia is investing $1.5 billion in SB Energy to secure its position as the sole provider of compute infrastructure for OpenAI's future Ohio data center, but the true scale of the chipmaker's exposure lies in a staggering $105 billion contingent guarantee. While the equity investment is a direct cash outlay, the larger figure represents a maximum payment obligation that would only be triggered if OpenAI becomes insolvent or defaults on its lease, according to a Form 8-K filed with the US Securities and Exchange Commission.

By backing the lease, Nvidia ensures that OpenAI has the physical land and power necessary to run Nvidia's full-stack DSX AI factory platform—essentially financing the environment required to maintain high demand for its own chips.

Related YouTube video

The project, located at the PORTS Technology Campus in Pike County, Ohio, will be built on land owned by the U.S. Department of Energy that previously enriched uranium for U.S. Navy submarines and the national nuclear arsenal. SB Energy, which is backed by SoftBank and OpenAI, will build and operate the facility under a 20-year lease beginning in phases from 2028.

The Infrastructure Gamble

The facility will start with 4.25 gigawatts (GW) of capacity, with Nvidia holding an option to secure an additional 3.75 GW, bringing the potential total to 8 GW. To power this, SB Energy plans to construct a 9.2 GW natural gas power plant at a cost of $33 billion.

The cost of this power plant reflects a broader industrial trend; BloombergNEF reports that the cost of building natural gas plants has risen 66% over the last two years. Furthermore, the project involves a partnership with AEP Ohio to invest $4.2 billion in regional grid infrastructure, with SoftBank and SB Energy planning at least 10 GW of new power generation overall.

Because these plants will compete for natural gas with export markets, some analysts suggest that natural gas prices could triple in certain parts of the country.

For the local economy, the stakes are measured in employment. OpenAI stated the project is expected to generate approximately 35,000 construction jobs through 2032 and 2,500 long-term operating positions.

Circular Financing vs. Fungible Assets

The $105 billion guarantee has triggered concerns among investors regarding circular funding flows, as reported by Outlook Business.

Nvidia CEO Jensen Huang has pushed back against this characterization. In a post on X, Huang argued that the deal is not circular financing because OpenAI will pay the lease.

"NVIDIA compute is versatile, fungible and broadly adopted. The capacity can be resold to another qualified tenant across NVIDIA’s global ecosystem of cloud service providers, enterprises, AI labs and startups,"

Jensen Huang, CEO of Nvidia, via Coingape

Under the SEC filing, if OpenAI defaults, Nvidia's obligation is to cover the shortfall between the guaranteed minimum value of the lease and whatever amount is recovered by selling the facility or finding a replacement tenant. OpenAI has agreed to reimburse and indemnify Nvidia for any such payments.

This strategy follows other aggressive financing moves by the company, including a recent partnership with six financial institutions to launch platforms targeting over $500 billion in third-party funding for AI infrastructure.

The financial structure of the Ohio project is summarized below:

Component	Financial Value	Nature of Obligation
SB Energy Investment	$1.5 billion	Direct equity investment
Lease Guarantee	Up to $105 billion	Contingent liability (triggered by OpenAI insolvency)
Power Plant Cost	$33 billion	Construction cost by SB Energy
Grid Infrastructure	$4.2 billion	Investment via AEP Ohio partnership

Nvidia's move to secure land and power reflects a growing reality where electricity and suitable sites have become the primary constraints on AI expansion.

Market sensitivity to this strategy is already evident. The Economic Times reported that Nvidia shares rose 0.6% on Monday following reports that the company had scaled back some plans for the Ohio project, which eased investor fears about circular financing.

Markets are now looking toward Nvidia’s upcoming earnings report next week for evidence that this aggressive expansion can continue.

The Financing Timeline and Terms

In January, OpenAI and SoftBank invested $1 billion in SB Energy to expand infrastructure for their Stargate initiative, according to Outlook Business. Nvidia's current $1.5 billion entry into SB Energy joins these existing investors in a project where the lease obligations could remain active until the 20th anniversary of each lease's beginment.

According to the SEC filing, the guarantees become effective once the facilities are ready for service and meet specific conditions. While the obligations are long-term, they can be terminated early if OpenAI achieves a satisfactory credit rating or terminates the lease under agreed terms.

The financial risk is further contextualized by SoftBank's previous relationship with Nvidia's equity. Yahoo Finance reports that SoftBank sold $5.8 billion worth of Nvidia stock in November to fund other investments, just before Nvidia moved to provide the massive credit support for the Ohio campus.

Jensen Huang has characterized the expansion into land and power as the next step in a corporate evolution that began with chip manufacturing and moved through systems, networking, and CUDA to the creation of full-stack AI factories.