Chevron Corp. has selected West Texas for its first natural gas-fired power project aimed at supplying a data center, marking a new business line for the oil giant amid the surge in artificial intelligence, the company said Wednesday.
Chevron is in exclusive talks with the data center’s operator, which it did not identify, and expects to make a final investment decision early next year, according to a statement and presentation released ahead of the company’s investor day. The facility is expected to begin operations in 2027, eventually reaching up to 5,000 megawatts of generating capacity.
The project is part of Big Oil’s push to meet rising energy demand from data centers, which are increasingly sited near fuel sources rather than major population centers. Chevron, a major producer in the Permian Basin, often has excess natural gas that exceeds pipeline capacity.
The West Texas facility is expected to produce about 2,500 megawatts by its third year, roughly equal to two nuclear reactors, and will likely operate separately from the grid to avoid straining local electricity supplies.
Chevron sees the project as a way to secure demand for its roughly 3 billion cubic feet per day of natural gas output.
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