The "wave of resistance" in the United States is intensifying! Oracle Corporation (ORCL.US)'s giant data center encounters "force majeure" and may not be completed on schedule.

Oracle invoked the force majeure clause in an attempt to build a financial firewall for its giant data center project in New Mexico, a move that adds further uncertainty to the already embattled Project Jupiter and quickly transmits pressure through the entire financing chain. According to Bloomberg, Oracle has sent a formal notice invoking the force majeure clause to the project developer, Stack Infrastructure, a subsidiary of Blue Owl Capital. The report said Oracle's move is not intended to exit its role as the main tenant, but rather to seek to defer related payment obligations in the event the project cannot come online as originally planned in 2028. After the news was announced, Oracle's stock price immediately fell, dropping more than 7% at one point during the day and still closing down about 3.5%. Blue Owl Capital's stock price also closed down 3.6%, and data center power provider Bloom Energy fell 3.1%. Project Jupiter is a massive special purpose vehicle (SPV) project that plans to build four data centers on about 1,400 acres of land in New Mexico, providing OpenAI with a total of $300 billion in computing power. Its financing structure includes bonds, loans, and Blue Owl equity. The issuance of the force majeure notice has sharply heightened market doubts over whether the project can proceed on schedule, and the related loans had already fallen to stressed levels. According to the Financial Times, citing people familiar with the matter, even if Oracle fails to complete the power connection before the deadline for the project's first phase, the company still has a contractual obligation to pay investors "carrying costs" in place of rent for up to three years. The deadline for the first phase is set for the first half of 2027. People familiar with the matter said, "The power supply risk is borne by Oracle, not the investors." Contract terms make clear: power supply risk belongs to Oracle According to media reports citing people familiar with the matter, under the contract signed between Oracle and the project developer, a subsidiary of Blue Owl Capital, even if the force majeure clause allows Oracle to temporarily suspend rent payments, it cannot exempt its obligation to cover the interest costs of debt holders, nor its obligation to provide a certain equity return to the Blue Owl funds participating in the project. The related funds have already invested billions of dollars in the project. As a customary contract law provision, the force majeure clause is intended to release a party's corresponding obligations when an uncontrollable event makes contract performance impossible. Oracle's basis for invoking the clause is that the project faces unforeseen permitting delays, which in turn make it impossible to connect power to the project. However, people familiar with the matter stressed that the contract already clearly stipulates the allocation of power supply risk, which is borne by Oracle rather than investors. The project itself: massive in scale, and equally massive in trouble Project Jupiter is located in Dona Ana County, New Mexico, covers about 1,400 acres, and is designed for a computing capacity of 2.45 gigawatts, equivalent to the simultaneous electricity consumption of about 1.8 million households, with a total investment scale of about $165 billion. The project is being developed by Stack Infrastructure, a portfolio company of Blue Owl, and Blue Owl itself has also committed to providing equity funding. However, nearly two years since it was announced, the project has become mired in multiple difficulties: Its key energy permit application was rejected; Local residents strongly protested over the project's impact on water supply and air quality; Gas emissions from Bloom Energy, the energy supplier Oracle contracted with, have also drawn outside criticism. According to a previous Bloomberg report, the first phase of the project is already at least seven months behind its original completion time, and the milestone originally planned for operation in November this year can no longer be achieved. To make matters worse, the Energy Transfer LP natural gas pipeline project supplying gas to Project Jupiter was originally scheduled to be put into use this month, but because the New Mexico State Land Office repeatedly refused to approve the pipeline route permit, it has been delayed by at least six months and will not be able to enter service until February 1, 2027 at the earliest. Bloom Energy's stock price fell in response to the Oracle news. Force majeure notice: the financial logic behind the legal maneuver Force majeure clauses have long been a standard tool in the energy and commodities sectors for responding to extreme events. But according to a client briefing published in June this year by law firm Quinn Emanuel Urquhart & Sullivan LLP, such clauses are rapidly becoming more common in data center development. The briefing noted: In AI data center projects, force majeure clauses are no longer boilerplate provisions at the end of a contract, but a core litigation and risk allocation tool that can determine whether a delay is merely an isolated event or cascades through the entire project's construction, customer, power, insurance, and financing documents. Bloomberg noted that Oracle's intention in issuing the notice is not to immediately exit its role as the project's main tenant, but to secure a contractual basis for deferring payments if Project Jupiter cannot come online as planned in 2028. However, whether this move can truly exempt Oracle from the financial obligations it previously committed to remains uncertain. In response, an Oracle spokesperson said: Project Jupiter remains on track, our commitment to New Mexico is unwavering, and we are full of confidence in the project's prospects. In addition, it is worth noting that data center leases usually contain provisions allowing customers to exit the contract if services fail to start on time. When Google signed a computing power contract with SpaceX this year, it retained the right to terminate if access could not be obtained by a specified date. Chain reaction: the Stargate blueprint and dual pressure on OpenAI The impact of Project Jupiter's delay goes far beyond a single project. As the flagship campus of the Stargate plan, its progress directly affects the pace of OpenAI's computing power deployment. OpenAI had previously signed agreements with Oracle and SoftBank to support the development and construction of five data centers, including the one in New Mexico. Once a computing power gap forms, it will have a substantial impact on its product expansion plans and commercialization process. Blue Owl Capital's stock price fell to a nearly two-month low after the news was announced, continuing to press toward historic lows. Oracle's own financial condition is also not optimistic, with the company's debt scale at about $167 billion. Oracle's credit default swap (CDS) spreads have repeatedly hit record highs. Another anchor project of the Stargate plan, the SB Energy data center led by SoftBank's Masayoshi Son, is also mired in trouble. The project's IPO plan has been forced to delay due to similar delay issues. SB Energy is designed to generate as much as 8 gigawatts of power and, once completed, will become the world's largest data center, but its implementation is also facing strong resistance at the local level. Oracle's force majeure notice today may further undermine outside confidence in that IPO. Political variable: midterm elections may intensify project uncertainty The state of New Mexico, where the project is located, is becoming a political bellwether in the controversy over AI data center construction. Local residents previously did not know the project was connected to Oracle and OpenAI. According to documents previously reviewed by Bloomberg, the developer only disclosed this information after obtaining approval, triggering a broader crisis of trust. Oracle has now launched a public relations campaign in New Mexico in an attempt to defuse local opposition, but the effect remains unclear. The outcome of the U.S. midterm elections will be a key variable affecting the project's direction. If the Democratic Party wins a majority of seats, it is widely expected that stricter regulatory scrutiny will be imposed on related projects, further delaying the construction process. This political uncertainty, combined with permitting bottlenecks, financing pressure, and energy supply delays, is gradually turning Project Jupiter from a symbol of the AI investment boom into a stress test of whether the entire U.S. AI infrastructure buildout can be delivered on schedule. This article is reprinted from "Wall Street Insights." GMTEight editor: Feng Qiuyi.