Nvidia agreed to guarantee up to $105 billion in conditional lease obligations for a new OpenAI data center campus in Pike County, Ohio, according to a securities filing.

The guarantee covers an initial 4.25 information technology gigawatts of compute capacity, a measure of power delivered to servers, with an option on a further 3.75.

Why Nvidia Guaranteed the Leases Instead of Lending

SB Energy will build, own, and operate the PORTS-Pike Technology Campus in Pike County under a 20-year lease to OpenAI.Nvidia signed multiple residual value guarantees covering roughly 4.25 gigawatts of information technology load.

If OpenAI goes insolvent or stops paying rent, Nvidia covers the shortfall between a guaranteed minimum lease value and whatever SB Energy recovers by reletting or selling the space, the filing shows.

OpenAI has agreed to reimburse Nvidia for any amount Nvidia actually pays the lessor. The guarantee also terminates once OpenAI achieves a satisfactory credit rating.

That termination clause points to the purpose. The guarantee lapses once OpenAI’s own credit is strong enough to support the leases without Nvidia.

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Nvidia Invests $1.5 Billion in SB Energy

Nvidia secured the initial 4.25 gigawatts and holds an option, at its sole discretion, over the remaining 3.75 gigawatts. Capacity is expected to come online in phases beginning in 2028.

OpenAI will run Nvidia’s full-stack DSX platform at the site, and Nvidia becomes the exclusive compute provider there.

SB Energy and SoftBank will build at least 10 gigawatts of new generation and invest at least $4.2 billion in regional grid infrastructure with AEP Ohio. Nvidia is investing $1.5 billion in SB Energy separately.

Nvidia CEO Jensen Huang described AI as infrastructure and called land, power, and shell capacity vital to scaling it.

“We are securing long-lived infrastructure for NVIDIA compute so OpenAI can deploy the most productive AI factories that can be upgraded repeatedly with each new generation delivering more intelligence and better economics,” he said.

The guarantee follows Nvidia’s August 10 announcement of financing platforms with six asset managers to mobilize more than $500 billion of third-party capital for AI compute. 

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Source: BeInCrypto