The future of the American artificial intelligence industry is tied to the massive data center initiative known as Project Stargate. Oracle, one of the biggest backers of that effort, just took steps to shield itself from financial liabilities from one leg of the project that has hit repeated snags. According to a report from Bloomberg, Oracle recently cited force majeure, a lever that could help the company wiggle out of financial obligations.
Oracle’s shakiness is tied to Project Jupiter, a planned 2.45 gigawatt data center set to be built in New Mexico as part of Project Stargate. The massive construction project is set to go online in 2028, but has hit some major hurdles along the way, including significant opposition from residents near the planned campus and regulatory concerns regarding the data center’s projected environmental impact. The New Mexico Supreme Court recently rejected two efforts to stop the plant’s attempts to secure permits, but more challenges are expected.
While all parties involved with Project Jupiter have insisted the build-out is still on track, it seems Oracle is, at the very least, considering contingencies. It sent notice of force majeure, a clause that is typically invoked when extraordinary events prevent one party from fulfilling its contractual duties, to project developer Blue Owl Capital and, according to Bloomberg, is apparently trying to delay its payments should Project Jupiter fail to turn its lights on by 2028.
Bloomberg noted that it doesn’t seem as though Oracle is trying to get out of the contract entirely and hasn’t asked to get out of its lease.
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