OpenAI has abandoned plans to directly rent computing capacity from a planned data centre in northern Norway even as Microsoft has stepped in to buy extra power from it. The latest development comes after ChatGPT-maker pulled back from a similar project in the UK – continuing a pattern of pulling back from independent infrastructure commitments that has emerged in recent weeks.According to a report by CNBC, the facility in question is a 230-megawatt ‘Stargate Norway’ campus in Narvik, being built by UK-based AI cloud startup Nscale. OpenAI had positioned itself as an “initial offtaker” at the site, which means it will be among the first customers to rent capacity when the facility came online, as part of the broader Stargate infrastructure initiative it announced with considerable fanfare in 2025.While the arrangement has now fallen apart, Microsoft is stepping in to take the capacity OpenAI had been in discussions to rent. OpenAI, meanwhile, says it will access Norwegian computing resources through its existing relationship with Microsoft’s Azure cloud division instead.
Why OpenAI is pulling back from Norway project
Citing a source with firsthand knowledge of the matter, CNBC reported that OpenAI had been in discussions to rent approximately half of the Narvik facility’s total capacity. OpenAI and Nscale did not reach agreement on an offtake deal. The specific points of disagreement were not disclosed, but an OpenAI spokesperson confirmed to CNBC that renting capacity from Microsoft instead “made more financial sense for the company, falling under existing contracted spending.”In October, OpenAI announced it had committed to purchasing $250 billion of services from Azure, Microsoft’s cloud computing division. Routing Norwegian compute through Microsoft rather than through a direct deal with Nscale allows OpenAI to draw down on that pre-existing commitment rather than creating a new, separate financial obligation.“We are moving ahead with our plans in Norway. Microsoft is an important partner in our network and we will work with them to access compute in Norway just as we already do in other parts of the world,” an OpenAI spokesperson was quoted as saying.
Microsoft expands its Narvik presence
For Nscale, the change in customer does not appear to represent a commercial setback. The startup announced that Microsoft was expanding its agreement at the Narvik campus, adding more than 30,000 Nvidia Rubin GPUs to its deployment there.The announcement builds on a deal struck in March, when Nscale said it would support Microsoft with the deployment of Nvidia’s Vera Rubin platform across sites in the UK, Norway and beyond.“Expanding our work with Nscale in Narvik helps ensure Microsoft customers have access to the advanced AI infrastructure they need as demand continues to grow across Europe,” said Jon Tinter, president of business development and ventures at Microsoft.
