- Nvidia is negotiating a ~$250B guarantee covering OpenAI's lease and construction debt at SoftBank's 10GW Piketon, Ohio campus — 70x larger than Nvidia's existing $3.5B in disclosed partner guarantees [1][2] - A separate $350B chip financing arrangement is also under discussion; total project cost exceeds $500B including infrastructure and GPUs [1] - Phase 1 targets ~800MW by 2028 on 3,700 acres of DOE land at the former Portsmouth uranium enrichment plant, with 9.2GW of Japan-funded natural gas generation planned [3][4] - Anthropic, Microsoft, and Google have also engaged with Commerce Secretary Howard Lutnick about access to the government-controlled power at the site [2] - Terms remain unsettled and the arrangement could still collapse; OpenAI lacks an investment-grade credit rating despite its $852B private valuation
[1][2] Nvidia is in talks to provide roughly $250 billion in financial guarantees to backstop OpenAI's lease of a planned 10-gigawatt data center campus in Piketon, Ohio, the Wall Street Journal reported on July 26 [1]. The guarantee would cover data center lease obligations and construction debt financing for the facility being developed by SB Energy, SoftBank Group's energy subsidiary, on approximately 3,700 acres of federally owned Department of Energy land
[2]. [3]The proposed backstop dwarfs Nvidia's existing disclosed partner lease guarantees, which totaled $3.5 billion as of its most recent quarterly filing — a figure that itself represented a fourfold increase from the prior quarter [5]. If finalized, the $250 billion arrangement would represent the largest single data center financing guarantee ever reported.
Separately, Nvidia and OpenAI are discussing a chip financing arrangement that could reach $350 billion, bringing the total financial commitment tied to the Ohio project above $500 billion [1]. Nvidia has already invested $30 billion in OpenAI
. The guarantee structure addresses a fundamental credit challenge: OpenAI, despite a reported $852 billion private valuation, remains unprofitable and lacks an investment-grade credit rating, making it difficult to secure favorable debt terms on its own
[2]. [2]The deal, if completed, would mark a significant step for OpenAI toward controlling its own compute infrastructure rather than renting capacity from Microsoft, Amazon, and Oracle [1].
The Deal Structure #
Under the proposed arrangement, Nvidia would guarantee OpenAI's lease payments and construction debt service at the Piketon campus. If OpenAI defaults on those obligations, Nvidia steps in and covers the payments — OpenAI retains the facility, and Nvidia absorbs the loss [1]. The guarantee covers the physical infrastructure only; Nvidia's own chips destined for the facility are excluded from the $250 billion figure and are subject to a separate financing discussion worth up to $350 billion
[1]. [2]The structure addresses a chicken-and-egg problem in AI infrastructure finance. SB Energy needs creditworthy tenants to raise construction debt on favorable terms. OpenAI needs massive compute capacity but cannot borrow cheaply. Nvidia needs guaranteed chip demand. The backstop effectively converts Nvidia's balance sheet into a credit enhancement layer for the entire supply chain.
Nvidia's existing partner guarantee program — $3.5 billion with $712 million in escrow — was disclosed in its Q1 FY2027 10-Q filing. The company took those guarantees in exchange for warrants and classified them as credit derivatives with immaterial fair value [5]. Scaling that framework to $250 billion would represent a qualitative shift in Nvidia's risk profile.
The Site: Piketon, Ohio #
The campus occupies the former Portsmouth Gaseous Diffusion Plant, a Cold War-era uranium enrichment facility that ceased operations in 2001 [3]. The DOE is leasing the 3,700-acre federal site to SB Energy, with U.S. Commerce Secretary Howard Lutnick controlling access to the government-managed power supply
[2]. [4]At full buildout, the campus would demand 10 gigawatts of power — roughly equivalent to the output of 4.5 Hoover Dams and larger than the entire current U.S. data center fleet in Northern Virginia. Phase 1 is expected to deliver approximately 800 megawatts of capacity by 2028, with construction slated to begin in mid-2026 [3] [4].
The power infrastructure includes 9.2GW of new natural gas-fired generation capacity funded through $33.3 billion in Japanese-backed financing, tied to Japan's commitment under the 2025 U.S.-Japan Strategic Trade and Investment Agreement [4]. AEP Ohio is partnering on $4.2 billion in transmission upgrades to connect the campus to the grid
.
[4]## Competing Interests OpenAI is not the only company pursuing capacity at the Piketon site. Anthropic, Microsoft, and Google have all engaged with Commerce Secretary Lutnick about access to the government-controlled power, according to reporting by Reuters [2]. The competition for the anchor tenant position underscores the scarcity of sites that can deliver multi-gigawatt power at the speed AI buildout demands.
For OpenAI, securing the lease would represent a strategic pivot toward infrastructure independence. The company currently relies on Microsoft Azure, Amazon Web Services, and Oracle Cloud Infrastructure for the bulk of its compute. Controlling its own campus — even one owned by SB Energy — would give OpenAI more leverage over its cost structure and supply chain [1].
Nvidia's Strategic Calculus #
The guarantee structure locks in what would be the single largest source of GPU demand in the industry. If OpenAI occupies a 10GW campus filled with Nvidia hardware, the chip revenue over the facility's lifetime could dwarf the guarantee exposure. Nvidia's data center revenue reached $115.2 billion in fiscal year 2026, up from $47.5 billion the prior year.
But the risks are substantial. Investor Michael Burry, known for his role in 'The Big Short,' responded to the report by posting 'Around and around we go' on social media and reportedly increasing his short position in Nvidia stock [6]. Nvidia shares closed Friday at $206.84, down 0.92%
.
[6]The proposed guarantee also introduces a new category of contingent liability that would need to be disclosed in Nvidia's SEC filings. At $250 billion, the backstop would exceed Nvidia's current market capitalization of approximately $5 trillion by a significant margin relative to any prior off-balance-sheet commitment the company has made [5].
What's Next #
Terms have not been finalized, and the arrangement could still collapse [1]. Key open questions include the duration of the guarantee, whether Nvidia receives warrants or other equity-like compensation as it has in smaller deals, and how the commitment would be structured on Nvidia's balance sheet.
The timeline for any announcement is unclear. Phase 1 construction is expected to begin in mid-2026, creating urgency around financing decisions. The DOE land lease, Japanese gas plant financing, and AEP Ohio grid upgrades all represent parallel workstreams that must converge for the project to proceed on schedule [3] [4].
Companies mentioned #
Further sources #
[[1] Wall Street Journal report on Nvidia-OpenAI $250B guarantee talks, via Reuters/… ↗](https://finance.yahoo.com/technology/ai/articles/nvidia-talks-openai-guarantee-250-233930971.html)
[[2] GovCon Wire: NVIDIA Eyes $250B Guarantee for OpenAI Lease at Federally Owned Oh… ↗](https://www.govconwire.com/articles/nvidia-openai-250b-guarantee-ohio-data-center)
[3] Construction Review Online: SoftBank's $500 Billion Ohio Data Center Hub, the P… ↗
[4] Data Center Frontier: SoftBank's 10 GW Ohio Campus Marks a Turning Point for AI… ↗
[[5] The Information: Nvidia Discloses $3.5 Billion in Data Center Lease Guarantees;… ↗](https://www.theinformation.com/briefings/nvidia-discloses-3-5-billion-data-center-lease-guarantees)
[[6] Yahoo Finance: Nvidia Reportedly Moves to Backstop $250 Billion in OpenAI Data … ↗](https://finance.yahoo.com/technology/ai/articles/nvidia-reportedly-moves-backstop-250-015059079.html)
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