Chevron executive says Texas permit freeze may delay a major data center investment decision

Daniel Droog, Chevron's vice president for power solutions, told Semafor that the final investment decision on Project Kilby could slip from the end of this year to 2027, after Governor Abbott imposed a moratorium on new data center permits last month.

Kilby, a joint venture between Chevron and the newly formed developer Joulent, plans to use nearly 3 gigawatts of behind-the-meter gas turbines, unconnected to the state grid, to power a Microsoft data center in West Texas under a 20-year offtake deal. Earthmoving has begun and construction contracts are close to signing.

Droog said the project remains on track for first power in 2028, and Joulent's new CFO Michael Wortley said he is confident the project meets the state's permit prerequisites. Droog added that across the industry, permitting and regulation have already caused some slowdown or potential delay.