Chevron to supply Microsoft data centre with natural gas as AI power needs grow

22nd Jun 2026 13:22

(Sharecast News) - American energy giant Chevron is making moves into the "power-for-AI" business, partnering with Microsoft to supply natural gas for on-site electricity at one of the tech firm's data centres in West Texas.

This will be Chevron's first large-scale facility designed to supply electricity to a data centre, which it said will close the gap between the increasing energy demands of AI and available supply.

The 2.7-gigawatt facility will be situated in Reeves County, home to the Permian Basin oil and gas field.

Natural gas, Chevron said, is a cost-effective way to help meet these needs as it's a "steady, controllable power source that's reliable at scale", and is abundantly available across the US.

The California-based energy firm said it has also identified "multiple sites where this model is both technically and commercially viable".

"Our agreement with Microsoft through Project Kilby represents Chevron's unique ability to deliver power to AI customers with certainty, speed and at a competitive cost, leveraging Permian natural gas supply, infrastructure and our proven execution capabilities," said Jeff Gustavson, president of Chevron's New Energies arm.

Chevron shares were up 0.9% at $175.11 in pre-market trading on Monday.