Chevron and Microsoft Strike Power Deal for West Texas AI Data Center
Chevron and Microsoft have agreed to a power supply arrangement for a 2.7-gigawatt AI data center in West Texas, powered by an on-site natural gas plant fueled by Chevron's local production.
Chevron has agreed to supply power to a Microsoft AI data center in West Texas under a deal that pairs the oil major's stranded natural-gas assets with the tech company's surging infrastructure demands. The 2.7-gigawatt project will feature an on-site power plant fueled directly by Chevron's local natural-gas production, according to a Wall Street Journal report.
The arrangement allows Chevron to monetize gas reserves that lack access to interstate pipelines or export terminals, while Microsoft secures dedicated power for compute-intensive AI workloads without relying on strained regional grids. Natural gas burned at the site will come from Chevron's Permian Basin operations in West Texas, where associated gas from oil drilling often faces limited takeaway capacity.
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