While resistance to large data centers grows in the US and elsewhere, the tech industry is looking at Patagonia in southern Argentina as a location for its next wave of mega-data centers. The region offers cool temperatures, access to hydropower and natural gas from the vast Vaca Muerta formation, and wide uninhabited land.
Several projects are already taking shape. Argentine energy company Pampa Energia has begun evaluating a data center near its Loma de la Lata power plant in the Neuquen province, with capacity for up to 500 megawatts of energy drawn from the nearby Vaca Muerta gas fields. The project has not been previously reported publicly.
Meanwhile, OpenAI and Argentine energy company Sur Energy signed an intent letter last October for a data center project in Patagonia under the banner Stargate Argentina, the first Stargate initiative in Latin America. The planned facility would have capacity of up to 500 MW and use renewable energy sources, with a total investment of $25 billion.
Polish company Green Capital has also announced plans for a data center in the southern province of Chubut, with a first phase targeting 300 MW expandable to 3,000 MW at a cost of $3 billion. And US green data center provider FlexDomes is seeking investors for a location in Neuquen.
However, experts caution against equating announcements with concrete projects. Connectivity and power infrastructure remain major hurdles despite the region's energy resources and favorable climate. The massive investment sums involved make political stability crucial. Some investors may wait for Argentina's presidential elections next year and a potential re-election of President Javier Milei, who promises substantial tax cuts and a favorable regulatory framework to attract the AI industry.
Geopolitical tensions also complicate matters: plans by Argentine power company CALF, with Chinese backing, to expand internet infrastructure and build a data center in Neuquen have sparked a diplomatic dispute between the US and China.
Sources: Heise, Reuters
