Oracle's "Stargate" key AI data center supporting natural gas pipeline rejected twice, seeking alternative route
Energy Transfer plans to lay parts of the natural gas pipeline, which will supply fuel to Oracle's Jupiter project, on federal land managed by the U.S. Bureau of Land Management, in order to bypass the jurisdiction of the New Mexico State Land Office, which has repeatedly rejected previous proposals. Previously, delays in this project caused Oracle's stock to drop by as much as 5% in a single day.
The planned pipeline to supply natural gas to a major Oracle artificial intelligence data center has now been rerouted, after its previous construction proposal was rejected by New Mexico state regulators.
The energy transportation company Energy Transfer LP, responsible for building and operating the pipeline, is now seeking to lay a 17.8-mile (approximately 28.6-kilometer) section of it on land managed by the U.S. Bureau of Land Management (BLM).
In a letter to the Federal Energy Regulatory Commission (FERC) submitted on August 17, Energy Transfer’s subsidiary Transwestern stated that the new proposal will avoid land managed by the New Mexico State Land Office.
Previously, the state land office had twice denied the pipeline's right-of-way application.
According to a previous article from Wallstreetcn, this project is one of the most critical components of the “Stargate” mega-contract; delays of the supporting natural gas pipeline once led Oracle's shares to drop as much as 5% in a single day.
As of publication, Oracle was down 2.2% in intraday trading on Tuesday.
This data center, called the “Project Jupiter”, is located in Doña Ana County, New Mexico, near the U.S.-Mexico border, and will provide services to OpenAI.
The data center is one of the largest projects of its kind, with plans for a 2.5 GW natural gas fuel cell power generation facility and a total investment that could reach $165 billion. The project has already sparked protests, mainly due to concerns about its potential environmental impact.
In its latest rejection, the New Mexico State Land Office stated last month that the land lease application submitted by Energy Transfer was “not in the best interests of the state.”
Meanwhile, Transwestern has postponed the planned start date for the “Green Chile” natural gas pipeline from August 15 to February 1, 2027. Oracle stated last week that the Jupiter project is still proceeding as scheduled.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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