Oracle delays Jupiter project, raises concerns in AI financing

Oracle has issued a force majeure notice related to the Jupiter data center project, which is being developed by Blue Owl's STACK Infrastructure to support OpenAI. The notice, attributed to delays in securing power for the site, has raised concerns among lenders and investors in the AI financing sector.

Blue Owl stated that the notice does not affect the parties' commitment to the project, though the situation is influencing discussions about other data center financings. SB Energy, which is developing a data center for OpenAI in Ohio, recently delayed its IPO, according to a person close to its financing.

Force majeure provisions are becoming more common in data center development agreements, allowing companies to delay obligations due to events beyond their control. This trend has led to increased scrutiny from lenders and investors, who are now focusing more on risk allocation than on the demand for AI infrastructure.

With U.S. interest rates at two-decade highs, Wall Street is re-evaluating the economics and politics of AI-related deals. Moody's projects that AI-related capital spending by the six largest U.S. tech companies will reach around $1 trillion in 2027, raising concerns about market absorption capacity and potential pricing pressures.

The Oracle situation is being studied as a case example of how contractual protections may be tested in the event of project delays. The Jupiter project is delayed by a year, with Blue Owl having invested $3 billion in equity and earning lower returns during construction, which are expected to increase once the data center is operational.

Legal experts note that data center contracts are rapidly evolving, with significant differences between agreements from earlier this year and those currently in place. At least 45 projects worth $68 billion faced opposition from community groups in the second quarter of 2026, following disruptions in the first quarter.