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Microsoft and Chevron Sign 20-Year Power Deal For Texas Data Center

Project Kilby will start with 2.67 gigawatts and avoid the local grid as Microsoft expands its AI data-center footprint.

  • Chevron Corp. signed a 20-year deal with Microsoft Corp. to provide natural-gas-fired power for a proposed West Texas data center, dubbed Project Kilby, supporting the tech giant's expanding artificial intelligence infrastructure.
  • Chevron's president of New Energies, Jeff Gustavson, noted the project uses byproduct natural gas from the Permian Basin, which he called 'the most abundant gas basin in the country,' to bypass grid constraints.
  • With commitments for seven GE Vernova Inc. turbines, the project carries an estimated cost of about $7 billion and will eventually generate 2.67 gigawatts of power.
  • Texas holds 33 gigawatts of planned data-center power projects, the largest pipeline in the country, demonstrating why Microsoft is securing dedicated off-grid power to bypass intensifying competition for local utility resources.
  • Targeting a 2028 launch for first power, Chevron plans to make a final investment decision later this year on the multi-billion-dollar development supporting growing artificial intelligence workloads.
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  • 42% of the sources are Center, 42% of the sources lean Right
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Financial Post broke the news in Canada on Monday, June 22, 2026.
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