Oracle triggers 'force majeure' on data center project over power delays, source says
ORCL•Oracle issued a force majeure notice to a Blue Owl unit over potential power delays at its New Mexico data center project. Blue Owl said the notice does not change the project's financial commitments, while Oracle said Project Jupiter remains on schedule.
1. Notice cites power delays
Oracle issued a force majeure notice to a Blue Owl unit developing Project Jupiter, a large data center in New Mexico, citing potential delays in securing power, a person familiar with the matter said. The source said Oracle is responsible for securing power under the contract and cannot terminate the lease.
2. Project commitments remain
Blue Owl said the notice does not change its financial commitments to the multi-year project. The source said Blue Owl has about $3 billion in equity and Oracle pays the debt costs; Blue Owl earns a 9% yield on its equity during development, with a levered yield expected to be around 11% upon completion. Oracle said the project remains on its planned schedule.
3. Completion planned for 2028
The 1,400-acre campus secured $18 billion in loans from a consortium of banks and is part of Oracle's agreement with OpenAI to provide AI computing capacity. Project Jupiter is planned to come online in 2028. William Blair said it expects minimal short-term impact on Oracle and that fiscal 2027 should not be affected because Jupiter contributes no revenue this year.
