Oracle Project Jupiter debt faces pressure in New Mexico

Approximately $18 billion in loans tied to Project Jupiter, a massive AI data center campus in Doña Ana County, New Mexico, are being quoted at 89 to 91 cents on the dollar. The debt, linked to Oracle’s infrastructure expansion and its agreement with OpenAI, is facing pressure as syndication efforts to sell the paper to a broader investor pool have stalled. Banks including Santander and Jefferies are reportedly holding more of the debt than originally planned due to weakened investor demand and concerns regarding Oracle’s rising borrowing and creditworthiness.

The project faces several operational and local challenges. Development is reportedly at least seven months behind schedule, complicated by issues involving power infrastructure and a rejected request for natural gas supplies. Additionally, the 1,400-acre site has encountered significant local opposition and legal scrutiny regarding its environmental impact, specifically concerning air quality and water supply. While the New Mexico Supreme Court recently lifted a stay on regulatory proceedings for these permits, the project continues to face pushback from environmental groups.