Chevron Corp. and Microsoft Corp. are moving forward with plans for a large-scale power and data center development in Pecos, Texas, with Chevron subsidiary Energy Forge One LLC signing a 20-year power purchase agreement to supply dedicated electricity to Microsoft’s planned facility.

The project, known as Project Kilby, is expected to provide approximately 2.67 GW of power capacity through a phased, modular development approach. Microsoft said in its official blog the associated data center campus will expand its global data center capacity by approximately 2 GW to support growing demand for artificial intelligence and cloud computing services.

According to Chevron, the power facility will use natural gas generation from GE Vernova turbines and additional capacity from Solar Turbines, a Caterpillar subsidiary. The co-located design will allow the facility to operate with dedicated power generation located onsite rather than relying solely on the regional grid.

First power delivery is expected in 2028, with Chevron targeting a final investment decision by the end of 2026 pending completion of required conditions.

Power, Emissions and Water Management

The facility will initially operate with a behind-the-meter power configuration, meaning the generation assets will directly supply the Microsoft data center. Microsoft said the approach is intended to provide scalable and reliable power capacity while limiting impacts on existing grid resources.

According to Microsoft, the natural gas power facility will include emissions control systems such as selective catalytic reduction technology to reduce nitrogen oxide emissions. Chevron also said the plant design will include measures to reduce noise and light impacts.

The companies are also incorporating water management strategies into the project design. Chevron said the facility will use non-potable, brackish groundwater rather than freshwater for power operations and is evaluating opportunities to reuse produced water from oil and gas operations.

Microsoft said the data center campus will use closed-loop cooling systems designed to reduce ongoing water consumption by requiring only an initial charge of cooling water during startup.

Manufacturing and Infrastructure Demand

The project reflects growing demand for large-scale energy infrastructure to support data centers and AI-related computing workloads. Microsoft said the Pecos campus is expected to support more than 6,000 construction jobs during peak development and create hundreds of permanent operational positions once online. Meanwhile, Chevron said in its press statement that Project Kilby is expected to support nearly 2,000 jobs and contribute economic activity to the region.