Chevron to supply gas for 2.7-gigawatt Microsoft Texas data center
Why it matters: The 20-year deal shows Microsoft turning to fossil fuel generation to meet round-the-clock AI power demand.
Chevron struck a 20-year agreement to supply natural gas for a planned Microsoft data center in West Texas that is expected to use nearly 2.7 gigawatts of electricity, roughly enough to power 2 million homes. The project, known as Project Kilby, is slated for Reeves County, with most of its electricity to come from large gas turbines supplied by Chevron partner GE Vernova and additional turbines from Caterpillar. Chevron said it expects a final investment decision later this year, and the facility is targeted to begin receiving power in 2028. The deal underscores how Microsoft is expanding beyond renewables as it races to secure reliable energy for AI-driven data center growth.