Exclusive: £20bn of UK AI Investment May Be Hypothetical
OpenAI’s Stargate UK project was set to be the largest AI infrastructure initiative in Britain, representing a significant advancement in the US-UK technology partnership. The multibillion-pound datacentre project was highly anticipated as a major step forward in AI collaboration.
However, OpenAI has since withdrawn from the project, citing regulatory concerns and high energy costs. has uncovered that OpenAI apparently never visited one of Stargate UK’s key sites, and that £20bn of the "potential" £30bn investment promoted by the UK government appears to have been entirely hypothetical.
These revelations raise serious questions about one of the most publicized UK AI developments, suggesting that the centerpiece of US-UK AI cooperation was largely a promotional announcement rather than a concrete plan.
This follows a investigation in March which found many deals aimed at integrating AI into the British economy were "phantom investments".
Government Approached Firms Ahead of Trump’s UK Visit
Sources familiar with the Stargate UK setup process indicated that the government approached UK firm Nscale and OpenAI shortly before Donald Trump’s visit to the UK last year, requesting their agreement to develop the Stargate UK site at Cobalt Park, a business park in North Tyneside.
"They needed a big announcement," said one source.
Stargate UK was announced amid a series of high-profile US-UK tech deals coinciding with Trump’s September visit to London. The announcement echoed OpenAI’s earlier pledge to invest $500bn to "secure American leadership in AI".
In comparison, Stargate UK’s ambitions were more modest. OpenAI was to collaborate with Nscale, a UK-based firm, and Nvidia, a leading AI chip manufacturer, to develop infrastructure across several UK sites.
The most prominent site was the planned datacentre at Cobalt Park, which the government designated as an "AI growth zone" during the US president’s visit.
Freedom of Information Request Reveals Lack of Engagement
A Freedom of Information (FoI) request obtained by shows that neither OpenAI nor Nscale ever met with local authorities at the North Tyneside site. Only Nvidia appears to have visited the North East Combined Authority, which oversees the Stargate UK site, doing so in February 2026, five months after Trump’s visit.
"Nscale were pretty much told to back the Stargate project, and it caught them completely unaware," said a source. "It was never really a thing. It was effectively just a government PR stunt, and [the OpenAI chief executive] Sam Altman took the hit when the plug got pulled."
When asked if OpenAI ever visited the site, an OpenAI spokesperson referred to a previous statement made when the company withdrew from Stargate UK:
"We see huge potential for the UK’s AI future … We continue to explore Stargate UK and will move forward when the right conditions such as regulation and the cost of energy enable long-term infrastructure investment."
An Nscale spokesperson stated that its chief commercial officer had visited North Tyneside but did not clarify whether any meetings with local authorities took place; no records of such meetings exist.
Government’s Investment Figures Questioned
The government’s press release claimed the AI growth zone housing Stargate UK was "set to" attract £30bn in investment. Of this, £10bn was "committed" by Blackstone, which is developing a separate datacentre in the area that appears to be proceeding as planned. The remaining £20bn was described as "potential" investment from future partners.
When requested details on how the £20bn figure was calculated and the identities of these future partners, the government declined to provide specifics, stating only that the figure represented the total potential investment the site could attract.
In response to the organisation Spotlight on Corruption, which posed the same questions and shared the answers with , the government explained that the £20bn represented the amount needed to build a datacentre and secure the computing power to utilize the site’s electricity supply of 1.1GW.
In other words, the government suggested the site would attract £20bn simply because that was the estimated requirement.
"It is disingenuous for the government to imply that the £20bn for the AI growth zone will be forthcoming, when it reflects the amount needed," said Kamila Kingstone, a senior campaigner at Spotlight on Corruption. "It will give false hope to communities that eye-watering amounts of money are on the way to boost the local economy when the reality might be very different."
Local Authorities Surprised by Stargate UK Announcement
John Johnsson, leader of the Conservatives in North Tyneside, said the Stargate UK announcement came as a surprise to local authorities.
"When it was announced, we were really, really taken aback. We were surprised because we weren’t made aware of any of these discussions. All of a sudden, there’s all of this pizazz and these great big things announced," he said.
The absence of meetings or prior coordination is unusual for a project that Sam Altman described as reflecting OpenAI’s "shared vision" for the UK’s AI infrastructure investment, and Nvidia chief executive Jensen Huang called "a historic chapter in US-United Kingdom technology collaboration."
Infrastructure and Energy Concerns
Additional doubts about Stargate UK have emerged. An FoI request from the UK’s National Energy System Operator indicates the site lacked a grid connection. Instead, it submitted an alternative, redacted solution to power itself.
"There’s just not the infrastructure there to be able to actually support it," said Johnsson. "It’s now looking highly unlikely whether the project is going to come to North Tyneside."
He added:
"The fundamentals, energy costs, grid capacity and infrastructure do not appear to have been in place to support a project of this scale.
It’s really disappointing. It did have a feeling of: this is too good to be true and then we started to sense quite quickly that perhaps things weren’t as further down the line as anticipated."
Government Response
A government spokesperson said:
"The government is determined to create the right conditions for investment in the UK’s AI and datacentre infrastructure, and on the delivery of our AI growth zones, with work now well under way in the north-east.
A dedicated taskforce co-chaired by the technology secretary and [the North East mayor] Kim McGuinness is driving forward planning, investment and skills for the region. The North East AI growth zone will increase its energy capacity to 1.1GW once fully operational, with over 400MW of this capacity to come online in 2028."
