Oracle Invokes Force Majeure on New Mexico AI Campus After Power and Pipeline Delays Hit

Oracle has sent a force majeure notice on Project Jupiter, a giant AI data center planned for Doña Ana County in New Mexico, near the US-Mexico border. The campus is part of the Stargate buildout meant to supply compute to OpenAI.

The notice went to the developer, a unit of Blue Owl Capital. Oracle wants, according to people familiar with the matter, the right to delay its payments if the campus does not come online as expected in 2028.

That is contractual cover, not a walkout. Oracle remains the main tenant, and nothing in the notice cancels the project or confirms that 2028 is already lost.

Both companies moved quickly to calm things down. "Project Jupiter remains on our planned schedule. We are fully committed to New Mexico and confident in our path forward," Oracle said. Blue Owl said the notice "does not change the financial commitments to this multi-year project."

The trouble is fuel. The campus could cost up to $165bn and run on as much as 2.45GW of Bloom Energy natural-gas fuel cells, The Next Web reports. That gas has to arrive by pipeline, and the pipeline keeps getting blocked.

The New Mexico State Land Office rejected pipeline rights-of-way in March and again in July. Land Commissioner Stephanie Garcia Richard cited emissions and the strain on local resources. Energy Transfer rerouted across federal land, and the pipeline's start date slipped from 15 August to 1 February.

It is a familiar pattern. Communities from Virginia to Thailand are pushing back on what these campuses do to power, water and land, and the pushback now reaches contracts worth tens of billions.

Investors noticed. Oracle shares fell between 4% and 5% on Thursday, per CNBC. The Financial Times has reported that about $18bn of debt tied to the data center is trading at stressed levels.

The money going out the door is already enormous. Oracle's capital spending consumed $28.5bn in cash last quarter, against $8.5bn a year earlier, and the company plans to raise about $40bn in debt and equity this fiscal year. A notice that lets it slow payments on one of its biggest bets is, at minimum, a hedge Oracle decided it needed.