Alphabet Inc., through its subsidiary Google, is reportedly in active discussions with Bolt Data and Energy, a data center developer co-founded by Eric Schmidt, the former CEO of Google, about initiating a substantial data center project in West Texas. The potential deal could involve a commitment of up to 250 megawatts, although the precise magnitude and terms of the transaction have yet to be finalized as negotiations continue.
Sources familiar with the matter indicate that this endeavor would make use of land assets owned by Texas Pacific Land (TPL), which offers critical infrastructure advantages including ample power availability and access to water resources necessary for cooling the facility. These resources have become increasingly valuable and strained due to rapid data center expansion across the United States.
Despite multiple outreach efforts, Google has not provided an official comment regarding the ongoing discussions. The strategic collaboration with Bolt Data and Energy holds particular significance given the rising importance of artificial intelligence (AI) in driving computational demand. Eric Schmidt has publicly characterized AI as an underappreciated transformative technology poised to revolutionize sectors ranging from finance to healthcare.
Schmidt has previously emphasized that energy availability stands as the primary bottleneck to scaling AI capabilities effectively. The proposed project aims to mitigate this challenge by utilizing TPL’s land, which is rich in water and situated in a region offering access to low-cost energy. The infrastructure would support the growing needs for computational power essential for advanced AI operations.
Bolt Data and Energy recently completed its initial financing round in December, raising $150 million. Among the investors was Texas Pacific Land itself, contributing $50 million, further solidifying the connection between the landowner and the data center developer. The plan involves developing data centers on TPL-owned properties in West Texas, facilitating a strategic alignment between energy resources, land availability, and data infrastructure.
On the financial front, Alphabet demonstrated solid performance in its recent fourth-quarter results. CEO Sundar Pichai indicated expectations for capital expenditures ranging between $175 billion and $185 billion out to 2026. The cloud segment, a critical growth driver for the company, reported revenue growth of 48% year-over-year, reflecting sustained demand from customers.
Industry analysts, including Doug Anmuth of JPMorgan, interpret Alphabet’s doubling of capital spending compared to prior years as a sign of structural strength and an aggressive posture toward infrastructure investment and technology build-out.
In summary, the possible partnership between Alphabet’s Google and Eric Schmidt’s Bolt Data and Energy for the West Texas data center project represents a critical move to address the mounting infrastructural requirements stemming from AI advancements. Utilizing Texas Pacific Land properties, the initiative looks to harness vital resources such as water and affordable power, elements recognized as key to supporting large-scale computational facilities.
While the negotiations are ongoing and details like final project size and financial commitments remain to be established, the endeavor clearly reflects the broader industry trend of increasing investments to overcome energy constraints and meet future demands in AI and cloud computing sectors.