Elon Musk reportedly tried to stop a major artificial intelligence (AI) deal involving OpenAI in the Middle East, but his efforts did not work. According to a report by The Wall Street Journal, the billionaire found out about the deal just days before it was about to be finalized and was upset that his own AI company ‘xAI’, was not included in the same.
The project in question, known as ‘Stargate UAE’, is a significant AI infrastructure initiative aimed at establishing large-scale data centers in Abu Dhabi. It is being supported by some of the biggest US-based tech companies, including Microsoft-backed OpenAI, Nvidia, Oracle, Cisco, and SoftBank. And a UAE-based company named ‘G42’ (which is run by a powerful royal family member – Sheikh Tahnoon bin Zayed) is leading this project.
As per the report, after learning about the project and related deal, Musk tried to stop it from going forward and even reached out to people close to US President Donald Trump. He reportedly claimed that the Trump team would not approve the project if ‘xAI’ was not involved. However, despite Musk’s efforts to obstruct the deal, the Trump-led government still gave the green light to the Stargate UAE project. And the deal moved forward as planned, without Musk or xAI having any role in it.
Musk’s reported move is not surprising, as he has long been a critic of OpenAI (especially regarding its transition to a for-profit model) and its CEO, Sam Altman. Musk co-founded OpenAI but left the company in 2018 after disagreements over its direction. Since then, he has criticized OpenAI for becoming too focused on making profits and for its close partnership with Microsoft. Last year (2024), he even sued the ChatGPT maker and Microsoft, accusing them of betraying OpenAI’s original mission. In response, the AI firm also filed a countersuit against Musk in April 2025, accusing him of harassment and using ‘bad-faith tactics’.
At the same time, the UAE is working to become a big player in the artificial intelligence sector. Since the US has put restrictions on sending advanced computer chips to China, the UAE is partnering with American companies like OpenAI to develop its AI systems. The Stargate UAE project is part of this effort. It is linked to Project Stargate, a large $500 billion AI investment plan announced by the US earlier this year. The ‘Stargate UAE’ project involves building huge data centers and investing billions of dollars in AI technology.
The first phase, which will provide 200 megawatts of power, is expected to start operating next year in 2026. Although Musk’s company, xAI, was not included in the first phase of the project, US officials have said that it might still be added in the future. But for now, the project will go ahead without him and his AI company.
The situation becomes even more interesting because this revelation surfaced shortly before Elon Musk announced his departure from the Trump administration advisory role. His exit came after he criticized the President’s ‘big beautiful bill’, signaling growing disagreements. In another recent move, Musk announced his return to an intense ‘24/7’ work schedule across his companies, following growing criticism and concerns from investors and the public about his divided focus (particularly due to his involvement in politics and the current Trump administration).