01/07/2026 by Joel Thompson
US-based oil major Chevron has announced its move into onsite power generation, starting with an agreement to supply Microsoft for 20 years.
The growing use of artificial intelligence (AI) is helping human workers to achieve better results in less time. It can analyse complicated large-scale data, like from medical and seismic imaging, and identify insights that might be missed by a person. Unfortunately, this is also driving up the power requirements of data centres that were already consuming considerable amounts of energy.
Drawing power from the grid would put a huge strain on it, so Chevron has conceived Project Kilby to co-locate power generation with a data centre run by Microsoft. Chevron, which also produces grease and lubricant under the Texaco brand, also has access to natural gas from its own rigs. The president of New Energies at Chevron, Jeff Gustavson, said:
“AI is reshaping the global economy, and abundant, affordable, reliable energy is essential to fuelling that transformation. Chevron is uniquely positioned to deliver power to customers with certainty, speed and at a competitive cost, leveraging Permian natural gas and our proven execution capabilities.”
He added that the company’s traditional strength in efficiently producing energy fit well with the demand for more energy from emerging sectors. If the project gets final approval, it could support almost 2,000 jobs, boost local and state revenues by over $10 billion and support wider economic growth in the area. Chevron also plans to employ various technologies to minimise any disruption to local communities.
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