MP Chi Onwurah, chair of the Science and Technology Committee, had earlier described the news as a “blow”.
Speaking to BBC Radio 4’s Today programme on Friday, Onwurah, who represents the Newcastle Central and West constituency within a few miles of the Cobalt Park site, said the plan had been “very long on ambition and short on detail” when it was announced in September to tie in with President Donald Trump’s state visit.
She said while she backed the government’s move to use AI and technology innovation as “key drivers of economic growth”, she believed the country’s dependency on US investment was “too great”.
Onwurah said the Labour government had “already moved to reduce energy costs for energy-intensive industries such as AI” but more needed to be done.
However, she added “there are certainly some problems in the Open AI business model, and also the energy spike as a consequence of the Iran war is a global energy increase”.
Following the announcement on Thursday, a government spokesperson said the UK’s AI sector had attracted more than £100bn in private investment since Labour came into office, and this was delivering jobs and opportunities for workers.