Big Oil Wants to Help Big Tech Boost AI Data Centers

Exxon Mobile and Chevron are entering the race to power artificial intelligence data centers, as the two oil majors bet that technology companies will eventually turn to natural gas to meet their enormous energy needs.

Exxon plans revealed this week to build a natural gas plant to power a data center. The oil company says that it would then use carbon capture and storage technology to reduce plant emissions by 90%.

“We are working with other large-cap industrial companies to rapidly deploy a solution that provides high reliability and low-carbon intensity power to meet the growing demand for computing power for artificial intelligence,” Exxon Chief Financial Officer Kathryn Mikells said Wednesday. , to Wall Street analysts. without revealing the names of the companies with which the oil company is working on the project.

The gas plant would not rely on the electrical grid and would be independent of utilities, allowing for faster installation than traditional power generation projects, Mikells said. Exxon has not disclosed a customer or timeline for the project.

Exxon has invested heavily in building a carbon capture network along the Gulf Coast with more than 900 miles of pipelines to transport CO2 from various industrial customers to permanent storage sites. The oil major estimates that decarbonizing AI data centers could account for up to 20% of its total addressable market for carbon capture and storage by 2050.

Chevron is also working on ways to power data centers, Jeff Gustavson, president of the oil company’s new energy business, said at the Reuters NEXT conference on Wednesday.

“This is something our company is very well positioned to participate in,” Gustavson said. Chevron is a major domestic gas producer with power generation equipment and large tracts of land that could be used for data centers, the executive said.

Alphabet, Amazon, microsoft and Goal They have mainly bought wind energy and solar energy for their data centers as they seek to mitigate the impact of their businesses on the climate. But the energy needs of Artificial intelligence is growing so much. that technology companies are looking for sources of electricity that are more reliable than renewable energy.

As a result, technology companies have shown growing interest in nuclear energy. Microsoft is helping bring the Three Mile Island Nuclear Reactor get back online by purchasing power from the plant. Amazon and Alphabet’s Google unit are investing in next-generation small nuclear reactors. Meta recently asked companies to submit it proposals to build new nuclear plants.

But the fossil fuel industry and energy analysts have argued for months that the technology sector will eventually have embrace natural gas because it simply takes too long to build nuclear plants.

Exxon CEO Darren Woods on Wednesday attacked nuclear power, saying his company is better positioned than any other in the United States to meet AI’s energy needs in the near term.

“If you’re betting on nuclear energy and something that’s coming in the future, we’ve got a long way to go,” Woods told Wall Street analysts on Wednesday. He small nuclear reactors The resources that technology companies are investing in are not expected to reach commercialization until the 2030s.

Exxon does not intend to start a power generation business, the CEO said. The company plans to use its experience leading large projects to help install power generation for data centers in the early stages of AI advancement, Woods said.

Once the initial advance is complete, Exxon will focus on trapping and storing emissions associated with data centers and supplying decarbonized natural gas to power plants running AI, Woods said.