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Exxon Mobil And Chevron are jumping into the race to power artificial intelligence data centers as the two oil majors bet that tech companies will eventually turn to natural gas to meet their massive energy needs.
Exxon Plans revealed A natural gas plant to power a data center is scheduled to be built this week. The oil company says it would then use it Carbon capture and storage Technology to reduce plant emissions by 90%.
“We are working with other large industrial companies to quickly deliver a solution that provides both high reliability and low carbon intensity energy to meet the growing need for artificial intelligence computing power,” said Kathryn Mikells, Exxon Chief Financial Officer, on Wednesday told Wall Street analysts without revealing the names of the companies the oil giant is working with on the project.
The gas-fired power plant would not rely on the electric grid and would be independent of utilities, allowing for quicker installation than traditional power generation projects, Mikells said. Exxon has not announced a customer or a timeline for the project.
Exxon has invested heavily in building a carbon capture network along the Gulf Coast with more than 900 miles of pipeline to transport CO2 from several industrial customers to permanent storage sites. The oil giant estimates that decarbonizing AI data centers could account for up to 20% of its total addressable carbon capture and storage market by 2050.
Chevron is also working on ways to power data centers, Jeff Gustavson, president of the oil company’s new energy business, said at the Reuters NEXT conference on Wednesday.
“Our company can very well participate in this,” said Gustavson. Chevron is a large national gas producer with power generation facilities and very large areas of land that could be used for data centers, the executive said.
Gas instead of nuclear power
alphabet, Amazon, Microsoft And Meta I primarily bought wind and wind Solar energy for their data centers as they seek to mitigate their companies’ impact on the climate. But the power needs from Artificial intelligence is increasing more and more that technology companies are looking for power sources that are more reliable than renewable energy.
As a result, technology companies have shown increasing interest in nuclear energy. Microsoft is helping to bring that Three Mile Island nuclear reactor come back online by purchasing electricity from the system. Amazon And Alphabet’s Google unit invest in next-generation small nuclear reactors. Meta recently asked companies to ship it Proposals to build new nuclear power plants.
But the fossil fuel industry and energy analysts have been arguing for months that the tech sector will ultimately succeed to use natural gas because building nuclear power plants simply takes too long.
Exxon CEO Darren Woods took a swipe at nuclear energy on Wednesday, claiming his company is better positioned than any other in the U.S. to meet AI’s near-term and near-term energy needs.
“If you’re betting on nuclear power and something that’s coming our way, there’s a long way to go,” Woods told Wall Street analysts on Wednesday. The small nuclear reactors Technology companies’ investments are not expected to be commercialized until the 2030s.
Exxon has no intention of starting a power generation business, the CEO said. The company plans to use its expertise in managing large projects to help install power generation for data centers in the early stages of the AI ramp-up, Woods said.
Once the early ramp-up is complete, Exxon will focus on capturing and storing emissions associated with its data centers and delivering decarbonized natural gas to the power plants that power AI, Woods said.
