Microsoft, Chevron, and investment fund Engine No.1 announced on Tuesday that they have reached an exclusive agreement concerning power generation and electricity supply.
Technology companies, including Microsoft, are actively working to secure power for their rapidly expanding data centers, which are essential for operating AI services such as ChatGPT and Copilot.
The three companies stated in a release that no commercial terms have been finalized yet, and there is no definitive agreement in place.
Chevron and Engine No.1 had previously announced a collaboration last year to construct natural gas power plants adjacent to data centers in the United States. The partners plan to utilize turbines from power services company GE Vernova.
Media reports detailed the agreement with Microsoft, describing it as a long-term arrangement connected to a proposed natural gas power plant in Western Texas, with an estimated cost of approximately $7 billion. The plant is initially expected to generate 2,500 megawatts of electricity to power a large data center campus.
Chevron stated in November that its first project using natural gas to power AI data centers would be built in West Texas, with a target operational date of 2027.
According to media reports from last week, Microsoft has agreed to lease a data center project that was originally developed for Oracle and OpenAI.
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