Oracle has sent a force-majeure notice to Stack Infrastructure, the Blue Owl Capital-owned developer of Oracle's Project Jupiter data-center campus near Santa Teresa, New Mexico. A person familiar with the matter told Reuters on Thursday, September 24, that the notice cites potential delays in securing power live.euronext.com. Bloomberg News first reported the notice, according to Reuters. Reuters' source said Oracle cannot terminate the lease under any circumstances, and that securing power for the site is Oracle's responsibility under the contract ksl.com - Oracle Project Jupiter….
Bloomberg, as summarised by El Paso Matters, reported that the notice could let Oracle delay some rent payments for up to three years if the campus's power supply is not ready on time elpasomatters.org. Reuters' source said Blue Owl has about $3 billion of equity in the project and Oracle pays the debt costs. Reuters also reported, citing media reports, that the 1,400-acre campus secured $18 billion in bank loans live.euronext.com. Oracle shares were down 3.3% on the day, Reuters reported. Oracle said "Project Jupiter remains on our planned schedule," and Blue Owl said the notice does not change the financial commitments to the project ksl.com - Oracle Project Jupiter….
The notice moves Blue Owl's rent, not Oracle's obligation
Reuters' source described the rent structure. During development, Blue Owl earns a 9% yield on its equity, and the levered yield is expected to be around 11% once the project is complete. Invoking force majeure extends the period during which Oracle pays the lower development-stage rent. Blue Owl still receives the higher rent for the originally planned duration, but that rent starts later live.euronext.com.
The Wall Street Journal, as circulated by Trade The News, reported that the lease carries "hell-or-high-water" terms. Under those terms Oracle must pay rent whether or not it has secured power, and any deferral automatically extends the lease, so the total paid to Stack stays the same tradethenews.com - Oracle Drops…. Our read is that the notice changes when Blue Owl collects the completion-stage rate, not whether it does. The cost to Blue Owl is time value, and the benefit to Oracle is cash timing.
That timing matters against Oracle's own cash position. The company reported free cash flow of negative $5 billion for its fiscal first quarter of 2027, against operating cash flow of $23 billion. It also sold $20 billion of common stock through an at-the-market program during that quarter sec.gov.
The gas arrives after the county's first-phase window
El Paso Matters reported that Oracle and its partners plan to power the campus with Bloom Energy fuel cells capable of producing up to 2.45 GW on site. That power plant would run on natural gas delivered through a new pipeline. The New Mexico Environment Department has not issued the plant's air permit. The public hearing on the permit was on hold amid lawsuits before the state Supreme Court, which cleared the way for the process to resume the week before the report. A hearing examiner and a hearing date have yet to be set elpasomatters.org.
The pipeline is Energy Transfer's Green Chile project, built through its Transwestern unit. Transwestern told federal regulators that the project's in-service date had moved from 15 August 2026 to 1 February 2027, TNW reported on August 14, 2026. New Mexico Land Commissioner Stephanie Garcia Richard has refused the route across state trust land twice, in March and on 15 July. She wrote that the pipeline would bring "no significant benefits for state lands." In May, Oracle told the Federal Energy Regulatory Commission that "time is of the essence" thenextweb.com.
The dates matter because of what the developers promised the county. Under their tax-break agreements with Doña Ana County, they committed to bring a first phase into operation between October and December 2026, and to complete the campus and power plant by the third quarter of 2028 elpasomatters.org. The revised pipeline date falls at least one month after the end of that first-phase window. Reuters, citing Bloomberg, describes the relevant online date as 2028. The two schedules do not reconcile on their face, and the lease text has not been published.
Credit markets have priced what Oracle calls routine
Oracle spokesman Michael Egbert said: "Force-majeure notices are commonplace in developments of this scale and are often used to preserve contractual rights among project partners" elpasomatters.org. The brokerage William Blair said it expects minimal short-term impact on Oracle: "Practically, fiscal 2027 should not be affected, since Jupiter contributes no revenue this year" live.euronext.com. Oracle reported remaining performance obligations of $664 billion in the same quarter sec.gov.
Debt markets reacted differently. A TipRanks headline on September 24 reported that Oracle's credit default swaps hit a record high and that its 2056 bond yield topped 8% cnn.com. The WSJ, as relayed by Trade The News, reported that at least one arranging bank had sold part of the $18 billion construction loans below 90 cents on the dollar.
The notice also touches Bloom Energy, the fuel-cell maker. Bloom issued Oracle a warrant for 3,531,073 shares at $113.28 in April sec.gov, and Oracle exercised it on a cashless basis on May 1, 2026, receiving 1,905,433 Bloom shares, according to Bloom's second-quarter 10-Q sec.gov. A TipRanks headline reported Bloom shares falling more than 3% on September 24, while a later CNN quote showed Bloom closing at $288.70 cnn.com. The next dated tests for Jupiter are the air-permit hearing, which has no date yet, and the pipeline's 1 February 2027 in-service target.