Oracle seeks payment protection amid delays for New Mexico data center

Oracle is looking to shield itself from financial penalties if its massive New Mexico data center, known as Project Jupiter, doesn’t open on schedule in 2028. The request for payment protection comes as the project faces a growing list of headaches: permit denials, environmental litigation, a credit downgrade, and construction delays that have already pushed timelines back by at least seven months.

A $18 billion bet showing cracks

Project Jupiter sprawls across roughly 1,400 acres in Doña Ana County near Santa Teresa, New Mexico. The plan calls for four data center buildings and an on-site microgrid, all designed to feed the compute-hungry demands of OpenAI’s AI workloads. Stack Infrastructure and BorderPlex Digital Assets are developing the site, with construction kicking off in September 2025.

As of early September 2026, the project sits at approximately 26% completion, with the initial phase already running at least seven months behind schedule.

The financing picture isn’t reassuring either. An $18 billion loan package arranged for the project started trading at 89 to 91 cents on the dollar by September 2026. Oracle’s credit rating took a hit too, dropping to BBB- before mid-September 2026, one notch above junk status, reflecting growing concern about the company’s ability to manage construction risks and its expanding debt load simultaneously.

Pipeline problems force a power pivot

The original plan relied on natural gas, but pipeline permit applications were denied. That forced Oracle into a strategic pivot toward Bloom Energy fuel cells as the primary power source, targeting 2.45 gigawatts of capacity. Related pipeline services have been pushed back to at least February 2027.

Environmental groups have mounted legal challenges over the project’s potential impact on air quality and water usage. The New Mexico Supreme Court lifted key permitting stays on September 17, 2026, clearing a path for certain project proceedings to move forward.

What Oracle is asking for

Oracle’s push for payment protection is essentially a hedge against the growing risk that Project Jupiter misses its target opening. Oracle executives have tried to keep stakeholders calm by emphasizing phased site rollouts, messaging that even if the whole campus isn’t ready by 2028, portions of it could come online in stages.

Why this matters beyond Oracle

Project Jupiter underpins Oracle’s over $300 billion agreement with OpenAI. The distressed pricing on the $18 billion loan package is a key signal, as bond markets are currently pricing in meaningful odds that this project doesn’t go according to plan. A further downgrade would push Oracle into junk territory, raising borrowing costs across the entire business. Oracle’s credit rating at BBB- leaves almost no margin for error.