The United Arab Emirates sovereign wealth fund Mubadala Investment is in talks to invest in a data center project in the northern city of Akita, Japan.

The two trillion yen ($12.6 billion) facility is led by US startup Bitgrit and local tech company S2.

Mubadala could help back the data center with up to a one trillion yen investment, UAE ambassador to Japan Shihab Alfaheem told Nikkei.

Should it be developed, the facility is expected to be operational in 2033 and have a maximum capacity of 500MW. Before this facility, Bitgrit plans to launch a smaller 1.5MW facility in Akita at the end of 2027.

S2 and Bitgrit first signed a memorandum of understanding with the city of Akita last October, forming a joint special purpose company to bring the data center to fruition.

Bitgrit develops 'Web3.0' and AI blockchain systems, as well as working with organizations to train models on private data.

S2 is a local server management firm based in Akita. In 2021, the company launched Japan's first professional esports team composed of elderly players, named the Matagi Snipers.