Argentina is making waves in the energy sector by embracing small modular reactor (SMR) technology, a strategic shift that underscores a growing ambition to modernize its nuclear landscape. This move, driven by President Javier Milei and his administration, marks a significant pivot from a previously planned Chinese-backed nuclear project. Instead, Argentina is turning its gaze toward private U.S. investment, signaling a desire to position itself as a global frontrunner in SMR technology while catering to the energy demands of burgeoning industries like artificial intelligence (AI).
Demian Reidel, the government’s point person on nuclear policy, laid out the ambitious plans for Buenos Aires province, where the site originally earmarked for the Chinese-designed Atucha 3 reactor will now host a 1.2GW SMR project. This project is being developed by Argentina’s own research institute, Invap, in collaboration with an undisclosed U.S. investor. “The design is Argentine, and the capital to develop it will be American—100% private foreign investment,” Reidel told the Financial Times, projecting that the first plant could be operational by 2030. The vision extends beyond domestic needs, with plans to export SMR technology, potentially placing Argentina on the global nuclear map.
Milei’s administration is not just about building reactors; it’s about creating a comprehensive energy ecosystem. The government aims to expand both nuclear capacity and uranium mining to attract tech companies. The cooler climate of southern Argentina is being marketed as an ideal locale for AI-focused data centers, where energy-intensive operations can thrive. “My dream is to have a place in Patagonia called Nuclear City, where you come with your project and you can just plug it in,” Reidel envisions. Nuclear energy, with its promise of clean and scalable power, stands out as a perfect match for the insatiable energy appetite of modern AI infrastructure.
International tech companies are already eyeing Argentina for potential data center projects, with announcements expected to roll out by 2025. Initially, these projects may lean on energy from the flourishing shale gas sector in Patagonia, but the long-term goal is clear: nuclear plants will ultimately provide a sustainable power source.
This strategic shift away from China’s influence is not without its challenges. While Milei has dialed back his anti-China rhetoric, the new administration’s focus on private investment and alignment with U.S. interests marks a significant departure from the previous administration’s $8.2 billion agreement with China for a conventional reactor. Argentina, already a leader in Latin America’s nuclear sector, currently generates 8% of its electricity from three state-owned plants. Yet, despite its rich uranium reserves, the country has yet to produce the metal, although efforts are underway to change that, with Canadian company Blue Sky’s uranium project moving into advanced stages under Argentine conglomerate Corporación América.
Experts see promise in Argentina’s pivot to SMR technology. “From an energy point of view, Argentina has the expertise, the land, and uranium,” said Julián Gadano, a former nuclear energy secretary. However, he warns that economic instability and limited infrastructure, particularly in broadband access, could hinder progress.
The International Atomic Energy Agency (IAEA) has shown its support, signing a memorandum of understanding to assist with Argentina’s nuclear ambitions. Yet, concerns linger over Milei’s austerity measures, which could impact funding for public nuclear agencies and universities that have historically supported Argentina’s nuclear prowess. “The challenge will be overcoming investors’ lack of trust in Argentina and non-energy infrastructure challenges,” Gadano cautioned. Some foreign investors remain on the sidelines, waiting for Milei’s reforms, including lifting capital controls and ensuring political stability leading up to the 2025 midterm elections.
Despite the uncertainties, Reidel exudes optimism. “What’s making this possible is the combination of fiscal discipline and a government that is actually business-friendly,” he asserts. “We’re open for business.” This bold approach could redefine Argentina’s energy landscape and potentially set a precedent for how emerging economies can leverage nuclear technology in a rapidly evolving global market.
