OpenAI, NextDC ink $7b Australian data centre deal ChatGPT-maker ramps up local expansion. By Tom Williams on Dec 08 2025 01:46 PM Print article OpenAI's growing demand for computing power will be serviced by a new site built by Australia's NextDC in Sydney. Images: Supplied / Shutterstock OpenAI will be the first major customer of a new $7 billion NextDC hyperscale AI data centre facility to be built in the Western Sydney suburb of Eastern Creek, the two companies announced on Friday. The agreement — part of a Memorandum of Understanding between the US maker of ChatGPT and the Australian data centre firm — comes as OpenAI seeks to expand the availability of local computational power amid major local investments from the likes of Amazon and Microsoft. While Information Age understands OpenAI’s commitment to be the first major customer of the NextDC facility provides enough demand to make the project economically feasible, the infrastructure will also be made available to other companies and organisations. The new facility on NextDC’s S7 site, which it acquired in 2024 for around $353 million, will include an interconnected AI campus and a “large-scale GPU supercluster”, NextDC said. The location is expected to accommodate a data centre with a capacity of around 550 megawatts — which would make it more powerful than CDC’s recently approved 504 megawatt facility that is set to be the largest in the southern hemisphere. The NextDC project will use new liquid cooling technologies which mean its clusters of GPUs — the Graphics Processing Units essential for AI workloads — “will not require ongoing potable drinking water for cooling", the company added. Power for the site would also come from “long-term power purchase agreements for new renewable energy sources", the federal government said. NextDC says its S7 site will contain an AI campus and a 'large-scale GPU supercluster'. Image: NextDC / Supplied The first phase of the S7 project would launch “one of the most advanced sovereign AI campuses in the Asia-Pacific region” in the second half of 2027, pending necessary approvals, NextDC said. “It is engineered as a sovereign AI facility with security, resilience and operational standards aligned to Australia’s SOCI [Security of Critical Infrastructure] framework.” The project is part of the OpenAI for Australia program, the American company’s first such initiative in the Asia-Pacific region. Government heralds ‘terrific outcome’ for Australia The Australian government, whose recently released National AI Plan dismissed proposals to directly regulate AI, saw OpenAI and NextDC’s announcement as “a terrific outcome for our economy and our thriving tech sector”, Treasurer Jim Chalmers said. The project "is expected to deliver thousands of direct and indirect jobs over the course of its construction, as well as ongoing technical, manufacturing, engineering, and operational roles”, the government said. "It's more proof Australia has the talent, clean energy potential, trade partnerships, and policy settings needed to be one of the big winners when it comes it AI,” Chalmers added. "Partnerships like these will help create good jobs, boost skills, and spread AI adoption across our economy.” Minister for Industry, Innovation, and Science, Tim Ayres, said the government’s National AI Plan featured “stable policy settings and clarity of this government’s approach”, which he argued was “critical to attracting private sector investment”. Wesfarmers's Leah Balter (left), with OpenAI's Jason Kwon (centre), and Minister Tim Ayres (right) at the OpenAI for Australia announcement. Image: OpenAI / Supplied OpenAI this year won its first contracts to provide AI services to the Australian government. The company, like many of its competitors, has also hired local lobbyists and flown executives to Australia for both media events and closed-door discussions with local firms and policymakers. OpenAI CEO Sam Altman said Australia’s AI industry had “deep technical talent, strong institutions and a clear ambition to use new technology to lift productivity”. "Through OpenAI for Australia, we are focused on accelerating the infrastructure, workforce skills and local ecosystem needed to turn that opportunity into long-term economic growth,” he said. OpenAI spruiks AI training and startup programs OpenAI used its data centre announcement to also reveal partnerships with three of Australia’s largest employers — Commonwealth Bank, Coles, and Wesfarmers — to offer AI skills trainings to small businesses and workers from 2026. Commonwealth Bank said it would work with OpenAI to “co-develop AI learning resources and masterclasses”, which would be provided to its 1 million small business customers. The bank itself already uses the enterprise version of ChatGPT as part of its operations. Coles and Wesfarmers, which each employ more than 100,000 Australians, said they would provide tailored AI training programs to staff through the OpenAI Academy. OpenAI also announced the launch of its first startup program in Australia, which will see it partner with local venture capital firms such as Blackbird, Square Peg, and AirTree. The program will give participating startups “up to $US15,000 [around $22,000] in API credits, technical mentorship from OpenAI engineers and global experts, and access to workshops on scaling, compliance and safety”, the company said. These initiatives follow similar AI training and startup programs offered by the likes of Amazon Web Services (AWS), Google, and Microsoft, as AI providers jostle to have Australian individuals and businesses rely on their AI models. Adopting AI and strengthening Australia’s local industry could boost the nation's GDP by up to $142 billion annually by 2030, according to economic analysis funded by OpenAI and released in October in collaboration with a committee of industry bodies, including ACS (Australian Computer Society), the publisher of Information Age. Tom Williams Tom Williams is a senior journalist at Information Age with key interests in consumer technology, artificial intelligence, quantum computing, cybersecurity, and telecommunications. He was previously a digital journalist at ABC News, where he covered technology and breaking news. You can follow Tom on Bluesky, LinkedIn, or Threads, contact him at [email protected], and send tip-offs via secure email to [email protected]. Tags: openai nextdc data centres ai artificial intelligence commonwealth bank coles wesfarmers tim ayres sam altman