Patagonia emerges as a strategic hub for global AI data centers

Argentina’s Patagonia region is emerging as a strategic frontier for artificial intelligence infrastructure. Global hyperscalers and energy companies are exploring the area due to its cold climate, which reduces cooling costs, vast land availability, and access to diverse energy sources including wind, hydroelectric, and shale gas from the Vaca Muerta formation.

Major projects are in various stages of development. Pampa Energía is studying a potential data center in Neuquén near the Loma de la Lata thermal plant, which could eventually consume up to 500 MW of power. Additionally, OpenAI and Sur Energy have signed a letter of intent for the ‘Stargate Argentina’ project, a potential $25 billion initiative aimed at building a large-scale, clean-energy-powered data center.

While the region offers significant advantages, challenges remain regarding the development of necessary fiber optic infrastructure and the high cost of electrical grid upgrades. Unlike in the United States, there has been little public opposition to these developments in Argentina so far, though the government seeks to balance industrial growth with the interests of local indigenous Mapuche communities.