Oracle has issued a force majeure notice to Blue Owl Capital’s STACK Infrastructure regarding Project Jupiter, a planned AI data center in New Mexico, according to reports from Bloomberg and other outlets. The notice, which seeks to delay contractual payments if the facility does not come online by its 2028 target, triggered a 4% drop in Oracle’s shares on Thursday. Oracle confirmed in a statement that Project Jupiter remains on schedule and reaffirmed its commitment to the project.
Oracle’s move and immediate market reaction
Oracle’s decision to invoke force majeure—a legal provision typically used for unforeseen circumstances beyond a party’s control—reflects growing caution within the AI infrastructure financing sector. The notice was sent to Blue Owl’s STACK Infrastructure, the developer of Project Jupiter, which is part of the broader Stargate AI infrastructure initiative announced in 2024 alongside OpenAI and SoftBank Group. Oracle’s shares fell $10 billion in market capitalization following the report, as investors questioned the company’s ability to deliver on its AI expansion plans.
Project Jupiter’s role in Oracle’s AI strategy
Project Jupiter is one of several high-profile AI data centers Oracle is developing to meet surging demand for AI computing power. The company has allocated $28.5 billion in capital expenditures in its most recent quarter, up from $8.5 billion a year earlier, and maintains a forecast of $90 billion to $95 billion in capital spending by fiscal 2027. The New Mexico facility is designed to support OpenAI’s operations, though Blue Owl and Oracle have stated that the notice does not alter their financial commitments to the project.
Regulatory and operational challenges
The project has faced public opposition and regulatory hurdles, including concerns from environmental groups and local residents about energy consumption and infrastructure strain. Additionally, Oracle’s $18 billion in debt tied to the data center has been trading at stressed levels, raising questions about the financial risks of the Stargate initiative. Despite these challenges, Oracle has reiterated that Project Jupiter is progressing as planned.
Broader implications for AI infrastructure financing
The force majeure notice has sent ripples through the AI infrastructure market, where lenders and investors are increasingly scrutinizing the economics of large-scale data center projects. Analysts note that while demand for AI computing remains strong, the financing side of the industry is becoming more risk-averse. This shift has led to delays in other proposed data center financings, including SB Energy’s planned campus in Ohio, which recently postponed its IPO. Industry experts suggest that the current environment is forcing companies to reassess risk allocation in AI infrastructure deals.
Industry response and ongoing commitments
Blue Owl, STACK Infrastructure, and Oracle have emphasized that they remain aligned on Project Jupiter. A Blue Owl spokesperson stated, “This notice does not change the financial commitments to this multiyear project.” Oracle’s statement echoed this sentiment, asserting confidence in the project’s delivery timeline. However, the invocation of force majeure underscores the heightened scrutiny facing AI infrastructure projects as companies navigate regulatory, financial, and operational risks.