Elon Musk’s xAI Eyes Saudi Arabia: Seeking Gigawatts of AI Compute Power in New Global Expansion
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Elon Musk’s artificial intelligence enterprise, xAI, is reportedly in active negotiations with Saudi Arabian entities to secure vast and stable computational resources by leasing local data center infrastructure—an effort aimed at meeting the immense processing demands of large-scale AI models.
This strategic move signals Musk’s ambition not only to establish a robust AI presence within the United States but also to expand into the Middle East, leveraging the region’s inexpensive energy, abundant capital, and favorable regulatory environment to build a global AI infrastructure footprint.
xAI is currently engaged in preliminary discussions with potential Saudi partners, including the AI startup Humain, backed by the kingdom’s Public Investment Fund (PIF), and another unnamed company that is in the process of constructing a 200-megawatt data center.
Humain has proposed a long-term collaboration with xAI, pledging access to computational capacity on the order of several gigawatts. Although construction has not yet commenced, PIF’s endorsement lends the proposal considerable credibility. Meanwhile, the other partner offers a more immediate solution, providing xAI with near-term access to its in-progress 200-megawatt facility.
Both partnership models follow a leasing framework, enabling xAI to utilize computational resources without owning the physical infrastructure. This approach enhances operational flexibility and cost-efficiency—critical advantages for a company in rapid growth mode—while minimizing the capital burden associated with heavy infrastructure investments and accelerating the deployment of AI training platforms.
As competitors such as OpenAI and Meta race to build proprietary supercomputing facilities, xAI’s expansion into the Middle East reflects a dual intent: securing greater computational capacity and capitalizing on Saudi Arabia’s strengths in power generation and nuclear energy potential to sustain AI’s energy-intensive future.
According to the Carbon Collective, a U.S.-based sustainability research institute, a 1-gigawatt AI data center consumes as much electricity annually as 900,000 households.
Despite its overseas ambitions, xAI continues to invest heavily within the United States. Its Memphis-based supercomputing facility is already operational under the codename “Colossus,” and Musk has revealed plans to build a second data center in a nearby region—laying the foundation for a transnational AI cloud computing network.
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