(MENAFN- Live Mint) Musk has cast fresh doubt over the financial backbone of OpenAI and SoftBank's $500 billion Stargate initiative, after reports revealed the project has dramatically scaled down its immediate ambitions due to internal disagreements and delays.

In response to a viral post on X by user NIK (@ns123abc), which declared,“BREAKING: OpenAI and SoftBank at odds struggling with Stargate project after 6 months of delay and have sharply scaled back its near-term plans. it's over,” Musk simply commented,“They simply don't.”

NIK also shared a screenshot of OpenAI's initial announcement of the Stargate Project from earlier this year, alongside a remark Musk had made at the time:“They don't actually have the money. SoftBank has well under $10B secured. I have that on good authority.” While Musk himself did not reshare his old statement, his comment on the thread renewed attention to his earlier scepticism.

The Stargate project was launched in January with major fanfare and the promise of reshaping the United States' AI infrastructure. Spearheaded by OpenAI, SoftBank, and Oracle, the initiative was touted to bring more than 100,000 jobs and establish advanced data centres across the country. The project also received backing from then-President Donald Trump, who hosted leading tech CEOs at the White House to celebrate the venture.

However, according to a new report by The Wall Street Journal, OpenAI and SoftBank have reportedly clashed over key terms of their partnership, including the location of the data centres. With momentum stalling, the immediate focus has now shifted to building a single, smaller data facility, likely in Ohio, by the end of the year.

This is a far cry from the scale originally envisioned. When the project was announced, stakeholders had pledged $100 billion for rapid deployment, with the remaining funds to follow over four years, Reuters reported. Oracle Chairman Larry Ellison had even claimed the first centre was already under construction in Texas.

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In a joint statement to Reuters, OpenAI and SoftBank said they were“moving with urgency on site assessments” and working on multiple fronts across different states.

The project's slowed progress comes amid a broader push by the Trump administration to accelerate AI development and energy production, including the declaration of a national energy emergency to eliminate regulatory barriers.

(With inputs from Reuters)

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