ORCL Stock Slides To Early August Levels – $165B New Mexico Project In Focus After Company Reportedly Cites ‘Force Majeure’

• Oracle is not seeking to exit the project, according to the report.
• Project Jupiter has faced regulatory challenges involving its power and water plans.
• The company has switched from a planned gas plant to Bloom Energy fuel cells and is seeking 2 gigawatts of renewable energy capacity in New Mexico.

Oracle (ORCL) shares fell in morning trade on Thursday after the company reportedly invoked a "force majeure" clause tied to Project Jupiter, its $165 billion AI data center campus in New Mexico.

According to a Bloomberg report, Oracle has sent the notice to the project’s developer, a unit of Blue Owl Capital (OWL), seeking to protect itself from payments and other costs if the facility is delayed and fails to come online in 2028 as planned. 

It added that Oracle is not seeking to exit the project, but is instead looking to defer payments tied to a facility that would not yet be operational.

ORCL stock fell as much as 7%, hitting its lowest level since early August in intraday trade, and was among the top-trending tickers on Stocktwits at the time of writing. Retail sentiment around the firm fell to ‘bearish’ from ‘neutral’ territory over the past day. 

Stocktwits has reached out to Oracle for comment but had not received a response at the time of publishing.

Why Oracle Invoked Force Majeure

A force-majeure clause generally covers extraordinary events outside a party’s reasonable control that can prevent or materially delay contractual performance. Depending on the contract, those events can include government action, permitting delays, legal restrictions and other disruptions.

The notice gives Oracle additional protection if permitting, legal or other setbacks push the project beyond its planned 2028 launch.

In this case, the force majeure notice follows months of regulatory and community opposition around Project Jupiter. Local opposition has focused heavily on the project’s water use, power infrastructure and potential air emissions.

Project Jupiter Faces More Uncertainty

The project’s power and water plans have drawn challenges. Oracle previously dropped plans for a dedicated natural-gas power plant and switched to Bloom Energy (BE) fuel cells. The company is also seeking proposals for 2 gigawatts of renewable energy in New Mexico.

In August, the New Mexico Supreme Court temporarily paused proceedings related to the air-quality permit and a construction water authorization. Last week, the court rejected the challenges and lifted those temporary pauses, allowing the permitting processes to move forward.

The air-permit process still faces uncertainty. The hearing officer overseeing the case, Max Shepherd, recused himself in August after environmental groups sought his disqualification. A replacement hearing officer will be needed for the proceeding to continue.

ORCL stock has fallen almost 30% year-to-date and over 55% in the last 12 months. 

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