Argentina wants to turn Patagonia into a hub for AI data centers. President Javier Milei’s government is offering tax incentives and pledging to keep artificial intelligence free from regulation to attract major technology companies. The strategy has attracted interest from companies including OpenAI, Amazon, Google and Oracle, but has also prompted concerns about environmental impacts and whether local communities will benefit.
Patagonia offers large areas of available land, mild temperatures, strong winds and access to gas from the Vaca Muerta shale formation. The gas could be used to generate electricity and cool data center facilities. Milei told the U.S. Chamber of Commerce last month that his government would not regulate AI.
Visitor records obtained by the Associated Press show that technology companies and investors have met with Milei and his advisers in recent months. Those reported to have taken part include investor Peter Thiel and representatives of OpenAI, Amazon, Google and Oracle. Data center developer Crusoe has also approached Argentine officials about investments backed by the U.S. government. The company helped build OpenAI’s main campus in Texas.
Polish developer Green Capital is discussing a separate project: a data center complex in Patagonia that it says would require a $3 billion investment. The facilities would be leased to major technology companies for AI processing, but the project has not yet secured a customer.
Milei is backing a proposal to cut corporate income tax from 25% to 15% for investments of at least $1 billion in AI and other emerging industries. The measure is awaiting Senate approval. It would not require companies to reserve computing capacity for Argentina or disclose how much water and electricity their projects would use.
Those omissions have prompted concerns about technological sovereignty. Alan Rocha Varsanyi of Argentine group Observatorio Petrolero Sur said computing capacity would mainly serve the international needs of companies leasing the facilities, rather than support local technological development. Nicolás Wolovick, a computer science professor at the National University of Córdoba, has also warned that a lack of regulation could expose the country to risks such as mass surveillance and cyberattacks, and make it a testing ground for technologies that might not be trialled in more regulated markets.
Green Capital plans to build its complex in Chubut province on 130,000 hectares leased from 14 rural landowners. One of them, agronomist and sheep farmer Francisco Sáenz, sees the project as a possible source of income as livestock farming declines. Construction is not expected to begin before 2028.
Once operating, the campus could use about 2.7 times as much electricity in a year as the entire city of Buenos Aires used in 2025, according to an Associated Press calculation. Green Capital says it would generate its own power through wind turbines, solar farms and gas generators. Provincial authorities hope the project will bring billions of dollars in investment, create specialised jobs and provide a market for surplus wind power.
The plans have not reassured all residents of nearby Trelew. Environmental studies are still underway and permits have not been issued. The company has not detailed the project’s water use or how much of its electricity would come from gas. Residents have organised in person and online under the slogan “Trelew Free of Data Centers.” Opposition has also reached Congress, where lawmakers amended a proposal to loosen restrictions on foreign ownership of land and blocked Milei’s plan to allow AI agents to control companies.
Sources: Olhar Digital.