Big Oil wants to help Big Tech power the AI ​​data center

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

Exxon announced plans this week to build a natural gas plant to power the data center. The oil major says he would use it later carbon capture and storage technology to reduce plant emissions by 90%.

“We are working with other major industrial companies to rapidly deploy a high-reliability, low-carbon solution to meet the growing demand for computing power for artificial intelligence,” Exxon CFO Catherine Michaels told Wall Street analysts on Wednesday. without disclosing the names of the companies the oilman is working with on the project.

The gas-fired installation would be independent of the electric grid and independent of utilities, allowing for faster installation than traditional power generation projects, Michaels said. Exxon did not disclose the customer or the timeline for the project.

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

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

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

Alphabet, Amazon, Microsoft and Meta in the first place they bought the wind and solar energy for their data centers as they seek to mitigate the climate impact of their business. But the government demands artificial intelligence is growing so big that technology companies are looking for more reliable sources of electricity than renewables.

As a result, technology companies have shown a growing interest in nuclear energy. Microsoft helps bring Nuclear reactor at Three Mile Island feed back into the grid by buying plant capacity. Amazon and Google Alphabet block are investing in new generation small nuclear reactors. Meta recently urged companies to ship it proposals for the construction of new nuclear power plants.

But the fossil fuel industry and energy analysts have argued for months that the technology sector will eventually accept natural gas because nuclear power plants take too long to build.

Exxon CEO Darren Woods on Wednesday hit out at nuclear power and said his company is better positioned than any other in the US to meet the energy needs of artificial intelligence in the near and near term.

“If you’re betting on nuclear weapons and what’s ahead, we’ve got a long way to go,” Woods told Wall Street analysts on Wednesday. The small nuclear reactors Technology companies are expected to invest without achieving commercialization by the 2030s.

Exxon has no intention of starting a power generation business, the CEO said. The company plans to use its experience managing large projects to help install power generation for data centers in the early stages of building artificial intelligence, Woods said.

Once the early ramp-up is complete, Exxon will focus on capturing and storing emissions associated with data centers and supplying decarbonized natural gas to AI-powered power plants, Woods said.