Oracle sends force majeure notice for Stargate data center delays
What's the story
Oracle has issued a force majeure notice to Blue Owl Capital, the developer of Project Jupiter, a Stargate data center campus in New Mexico, Bloomberg reports. The move comes as part of Oracle's strategy to protect itself from potential cost increases due to the delay in the facility's opening by 2028. A force majeure clause is typically included in contracts to absolve parties from their obligations due to unforeseen circumstances beyond their control.
Project status
Oracle reaffirms commitment to Project Jupiter
Despite issuing the force majeure notice, Oracle has reiterated its commitment to Project Jupiter.
The company said in a statement to to CNBC that "Project Jupiter remains on our planned schedule."
This comes amid rising scrutiny over AI data center construction and the high costs developers face to build capacity for clients like OpenAI.
Supply issues
Energy supply challenges for Stargate data center campus
The Stargate data center campus has faced a number of challenges, particularly with its energy supply.
The facility, which is designed to handle 2.45 gigawatts (GW) of power, relies on gas-powered fuel cells from Bloom Energy.
However, an Energy Transfer pipeline that was supposed to deliver gas to the site has been delayed by nearly six months to February 1, 2027, due to permit rejections by regulators.
Opposition
Project Jupiter faces political and public opposition
Project Jupiter is one of the flagship sites of Stargate, an AI infrastructure initiative launched by Oracle, OpenAI, and SoftBank with President Donald Trump.
However, it has faced opposition from residents and environmental groups. The project has also become a political flashpoint ahead of midterm elections.
In response to criticism, Oracle has launched a public outreach campaign in New Mexico to win over skeptics.