Army Selects Utah's Dugway for Massive AI Data Center

The U.S. Army conditionally picked Dugway Proving Ground to enter exclusive negotiations with data center operator CyrusOne for a 1,200-acre computing campus.

Apr. 1, 2026 at 3:35pm

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The U.S. Army has conditionally selected Dugway Proving Ground in Utah's Tooele County to enter exclusive negotiations with data center operator CyrusOne for a massive 1,200-acre computing campus focused on artificial intelligence. The plan is part of a two-site push by the Army to lock in more AI computing capacity, with Fort Bliss in Texas also being considered. While no final deal has been signed, the Army says the project would be financed, built, operated, and maintained by private companies under long-term leases, with the military securing a percentage of the data center capacity for its own use.

Why it matters

This plan represents a significant step by the U.S. Army to shore up domestic AI infrastructure and computing capacity, which it views as a critical strategic asset. However, the project also raises major questions for the local Tooele County community, including the source of the required power and water, the environmental impact, and the level of community input and oversight.

The details

Under the conditional selection, data center operator CyrusOne would finance, build, operate, and maintain the 1,200-acre computing campus at Dugway Proving Ground. The Army says developers will be responsible for designing on-site power and water solutions, while the military would lock in a percentage of the data center capacity for its own use. Similar plans are in the works for a larger data center at Fort Bliss in Texas. The Army is leaning on its Enhanced Use Lease authority to structure these long-term private-public partnerships.

  • The Army says Initial Operating Capability at Fort Bliss is projected for fiscal year 2027.
  • The Army projects Initial Operating Capability at Dugway in fiscal year 2029.

The players

CyrusOne

A data center operator whose ownership includes funds managed by KKR and BlackRock, CyrusOne has been conditionally selected by the Army to enter exclusive negotiations for the Dugway data center project.

Carlyle

The global investment firm Carlyle has been conditionally selected by the Army to enter exclusive negotiations for the Fort Bliss data center project.

U.S. Army

The U.S. Army is driving this initiative to build massive new AI-focused data centers at Dugway Proving Ground and Fort Bliss, seeing it as critical to shoring up domestic AI computing capacity.

Tooele County

The remote Tooele County community in Utah's high desert where the Dugway data center is planned will be significantly impacted by the project's power, water, and environmental demands.

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What’s next

The conditional selections kick off an exclusive negotiation period to finalize lease terms, complete environmental studies, and nail down force-protection measures. The Army says the U.S. Army Corps of Engineers will provide technical expertise during those talks.

The takeaway

This data center project represents the Army's ambitious push to shore up domestic AI computing capacity, but it also poses major challenges for the local Tooele County community in terms of infrastructure, environmental impact, and community input. The coming months will be critical as the Army and private developers work to hammer out the details and address local concerns.