Oracle and OpenAI have terminated negotiations for a 600-megawatt expansion of their flagship Abilene data centre campus in Texas. The planned development, intended to add at least two buildings for OpenAI, has instead attracted early-stage interest from Meta. Oracle’s shares initially dropped 3.5% on the news, closing Friday down 1.2%.

The Abilene site was the first to break ground under OpenAI’s Stargate infrastructure project, announced at the White House last year with backing from SoftBank and Oracle. For Oracle, the deal was central to its aggressive pivot into AI infrastructure, competing directly with Amazon and Google. The collapse follows a previous failure to secure a $10bn Michigan project.

Despite the setback, the core $300bn agreement signed in September, which commits Oracle to provide OpenAI with 4.5GW of computing capacity, remains in place. That demand can be met through other sites in Texas, New Mexico, Wisconsin and Michigan. However, Oracle’s mounting debt to fund these commitments has sparked credit rating concerns and prompted plans for significant restructuring, including potential lay-offs and asset sales.