OpenAI is abandoning its plans to purchase computing capacity directly from Nscale’s data center in Narvik, Norway. Microsoft is taking over that capacity and expanding its agreement at the Narvik campus with more than 30,000 Nvidia Vera Rubin GPUs. OpenAI will now lease the capacity through Microsoft, which is more cost-effective.
An OpenAI spokesperson confirmed this to CNBC. In 2025, OpenAI, together with Nscale and the Norwegian investor Aker ASA, announced the Stargate Norway project. It involved a 230 MW data center near Narvik, powered by renewable energy. As the “initial off-taker,” OpenAI was to purchase approximately half of the facility’s capacity. Ultimately, however, Nscale and OpenAI were unable to reach an agreement, it now appears.
Microsoft expands agreement with Nscale
Instead of a direct deal with Nscale, OpenAI will lease computing capacity through Microsoft. A spokesperson for OpenAI told CNBC that this is financially more attractive because it falls under existing contractual agreements with Azure. A spokesperson stated that the Norwegian plans are therefore still moving forward, with Microsoft as “an important partner in our network.”
OpenAI is referring to the contract it signed with Microsoft in October to purchase $250 billion worth of Azure services. The relationship between OpenAI and Microsoft has undergone significant changes in recent years, partly because Microsoft allowed OpenAI to use other cloud providers as well.
Nscale confirmed on Tuesday that Microsoft is expanding its agreement at the Narvik campus with more than 30,000 Nvidia Vera Rubin GPUs. Jon Tinter, President of Business Development & Ventures at Microsoft, stated in a press release that the expansion ensures Microsoft customers continue to have access to advanced AI infrastructure in Europe.
OpenAI is cautious
This demonstrates once again that OpenAI has become notably cautious in 2026. It has spent billions of dollars in recent years and will continue to do so for AI expansion, but is making significant cuts to its spending. ChatGPT’s free version has also gradually started displaying ads. Last week, the company also put its British Stargate project on hold, apparently due to high energy costs and an unfavorable regulatory climate in the United Kingdom.
Funding is still coming in to fuel further growth. Earlier this year, OpenAI closed a record-breaking funding round of $122 billion, at a valuation of $852 billion. A potential IPO for OpenAI is planned for this year, which is increasing scrutiny of the company’s spending. In February, OpenAI told investors it aims for approximately $600 billion in total compute spending by 2030.