Saudi Arabia Shifts Focus from NEOM Megacity to AI Data Centers
The NEOM project in Saudi Arabia has faced significant challenges, leading to the suspension of The Line megacity in September 2025. Originally designed as a 170-kilometer linear city for 9 million residents, the project has been downsized due to soaring costs and delays, with estimates for total expenses now reaching $8.8 trillion. Meanwhile, NEOM is pivoting towards artificial intelligence, with Oxagon transforming into a data center hub, including a $5 billion partnership with DataVolt to create a net-zero campus by 2028.
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The NEOM project in Saudi Arabia is undergoing significant changes, marked by the suspension of The Line megacity, which was set to span 170 kilometers and accommodate 9 million people. This decision was made in September 2025 after an investment of about $50 billion, as rising costs may see the total project expenses soar to $8.8 trillion, far exceeding the initial $1.5 trillion estimate.
Meanwhile, Oxagon, part of NEOM, is being developed into a strategic hub for artificial intelligence data centers, including a $5 billion partnership with DataVolt to establish a net-zero data center campus operational by 2028. This aligns with Saudi Arabia's broader ambitions to be a leader in AI and cloud computing, with $40 billion allocated for AI investments.
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