Chevron Picks West Texas for Its First AI Power Plant

MIDLAND, TX - Chevron has chosen West Texas as the site of its first natural gas power project designed to support data centers in the growing artificial intelligence industry, according to reporting by the Houston Chronicle.

The Houston-based oil company announced Wednesday during an investor presentation that the facility is expected to come online by 2027. Chevron did not disclose the exact location or the client for the data center but said the site will be in the oil- and gas-rich Permian Basin.

Chevron Vice President of Lower Carbon Energies Jeff Gustavson said the company’s operations in the Permian give it a “data advantage” and that Chevron is developing AI tools to expand that capability.

Chevron Chief Financial Officer Eimear Bonner said negotiations for the project “are progressing at pace.” Once operational, the plant is expected to generate 2.5 gigawatts of power — enough to supply about 1.8 million homes — with potential to double output in the future, according to the Chronicle.

The announcement comes as major oil and gas producers, including ExxonMobil, move into powering data centers that demand increasing amounts of energy for AI applications. Federal estimates project that data centers could triple their electricity use by 2028, accounting for roughly 12% of U.S. power consumption.