The $1 billion project, which will make Southland a cheaper ‘green’ hub for storing data and providing cloud computing services in Australia, New Zealand and beyond, has taken two big steps.

The company behind the project, DataGrid, has purchased a 43-hectare site in northern Makareva, near Invercargil, with plans to begin construction of a massive cloud computing facility later this year.

Singapore-based shipping giant BW Group has meanwhile invested in DataGrid, agreeing to acquire a 37.5% stake in its holding company previously owned by ColPlus founder Malcolm Dick.

BW Group President Andreas Sohmann-Pao said the datagrid “will implement New Zealand’s renewable energy for sustainable digital infrastructure and connectivity for the country”.

BW had previously agreed – subject to the approval of the Foreign Investment Office – to buy 100% of undersea cable company Hawaiki, which was founded and chaired by DataGrid chief executive Remi Gallaso.

Hawaiki already has a $445 million fiber optic cable connecting the North Island to the United States and Australia, and announced in November that it would build another 22,000 kilometers of underwater Internet cable network. Hawaki Nui – Connecting the South Island of New Zealand, Australia and Singapore. , Indonesia and the United States.

In December, Hawaiian was selected by the Chilean government to pursue the Humboldt Cable project between Chile and Australia, which could pass through Invercargill and potentially connect Antarctica.

One of Hawaiki Nui’s goals is to connect DataGrid data centers to customers in Australia, so that large IT companies can use the region’s affordable ‘green’ energy to deliver applications to Australians.

GALASSO has confirmed that the total investment in Hawaiki Nui and DataGrid data centers will exceed $1 billion.

A model of DataGrid’s “hyper-scale” data center.

DataGrid had entered into resource consent discussions with Southland District Council for a data center at the site purchased between Flora Road East and Taylor Road in North Makareva, it said.

The agreement, which DataGrid plans to take up with earlier this year, will be to feature 10 modules each 6,500 square metres, which, if all built, would cover an area of ​​about nine rugby pitches.

Galasso said 800 to 1,200 workers would be needed to build and prepare the data center during peak construction.

“We plan to start construction as soon as we have consent from the resources of Southland District Council, hopefully in the second half of this year,” he said.

Initial construction will likely be for one module, costing more than $100 million, which should be completed by the end of next year, he said.

The resource consent app will allow the data center to consume 150 megawatts of electricity, more than a quarter of the electricity currently used by Southland’s Ti Point aluminum smelter.

Southland District Council Mayor Gary Tong said he was pleased the tech venture would continue.

“Everything is going as with any development, and the data center concept is definitely in mind since Rio Tinto announced it was going to discontinue Ti,” he said.

“Once I’m fully informed, I’ll do my best to make sure the correct procedures are in place to keep everything running smoothly.”

Southland District Council Mayor Gary Tong says it is ‘fantastic’ that the DataGrid business will continue as the sector needs to diversify.

Meridian Energy’s chief development officer, Guy Waipara, said it could supply up to 100MW of power to DataGrid, whether the smelter remains open by the end of 2024 or Meridian facilitates the construction of a “green hydrogen” facility in the region .

“Are we going to find a way – absolutely,” he said.

Galasso suggested that the South Island could replicate Iceland’s success in the international data center industry.

“We are quite advanced with some key customers, and we plan to make more announcements,” he said.

Remi Gallaso, chief executive officer of Hawaiki Cable, says the combination of the Hawaiki Nui (pictured above) and the Humboldt Cable will open a new route connecting Southeast Asia, Australia and South America.

Galasso said one benefit of locating data centers in Southland is that the region’s cooler climate means they can be at least 15% more energy efficient than similar facilities in Auckland, Melbourne or Sydney.

Reducing cooling requirements will save datagrid customers millions of dollars, he said.

“From a global perspective, these are also ‘megawatts’ of electricity generation that can be used for other industrial needs.”