SB Energy Grants OpenAI $5.5 Billion in Warrants to Lock In 10GW Stargate Data Center in Ohio

SB Energy granted OpenAI warrants valued at $5.5 billion in exchange for a 20-year lease at a 10GW Stargate data center in Ohio. The arrangement was disclosed in SB Energy's draft IPO filing.

The Facts

In January 2026, OpenAI and SB Energy reached an agreement under which OpenAI invested $500 million in SB Energy and selected it to build and operate a 12GW data center campus in Milam County, Texas. More recently, the two parties signed a 20-year lease agreement for a 10GW data center in southern Ohio, with initial capacity targeted to come online in 2028. SB Energy could launch its IPO as early as September, aiming to raise $5-7 billion, with OpenAI expected to hold a single-digit percentage stake after the IPO. The warrants were valued at $3.6 billion when granted in January, rising to $5.5 billion by the end of June.

Mechanism Breakdown

SB Energy ties its valuation growth to OpenAI through the warrants. The $500 million equity investment from OpenAI flows directly into SB Energy's capital base, while OpenAI has committed to becoming its primary data center tenant. SB Energy has signed nearly 9GW of compute capacity contracts, the vast majority of which are tied to planned natural gas power plants in Ohio. The company currently has no operational data centers, with only 800MW of projects under construction. Revenue comes primarily from its solar and energy storage business, which generated $140 million in the first half of 2026, up 66% year-over-year. The filing shows that financing for the Ohio project relies heavily on NVIDIA providing residual value guarantees.

Industry Impact

For OpenAI, this move locks in long-term compute supply and reduces uncertainty around future training scale expansion. For SB Energy, OpenAI becomes a core customer, supporting its IPO valuation and financing, but it also creates high concentration risk. For other large model labs, this model of cross-linked equity and lease arrangements could become a new paradigm, putting pressure on traditional on-demand leasing. For energy infrastructure developers, investments and long-term leases from leading AI companies become key conditions for project financing, making it harder for smaller developers to secure power resources. For enterprise customers, compute leasing costs and supply stability will be increasingly shaped by partnerships between a handful of labs and energy providers.

Strategic Assessment

Based on available facts, other large model labs and energy infrastructure providers may pursue similar warrant or equity investment arrangements.