New Era Energy & Digital (NASDAQ:NUAI) announced that it has signed a non-binding letter of intent to form a joint venture aimed at developing and financing its Texas Critical Data Centers (TCDC) campus in West Texas.
The proposed partnership would bring together New Era, data center developer Stream Data Centers, and an unnamed institutional investor that would provide equity capital and help arrange project financing.
The collaboration is intended to support the construction of a large-scale data center campus designed for artificial intelligence and high-performance computing workloads.
Under the terms outlined in the letter of intent, New Era is expected to contribute control of the project site and local relationships, while Stream Data Centers would take on responsibilities related to development, leasing, and operations.
The institutional investor would lead financing efforts, which are expected to include a significant portion of debt funding.
New Era said that it plans to remain an active stakeholder in the project by co-investing equity alongside the institutional partner, rather than acting solely as a land provider.
The company said this structure could allow it to generate ongoing revenue through distributions tied to operating cash flow once initial phases of the project become operational.
The project is expected to be structured through a newly formed limited liability company. Governance provisions are anticipated to include protections and rights for New Era as a partner in the venture.
“The fact that Stream and a premier provider of infrastructure capital have chosen to partner with New Era validates both the strategic value of the TCDC campus and the strength of our development strategy and platform,” New Era CEO E. Will Gray II said in a statement.
“This LOI represents an important step in advancing TCDC toward delivery, and we remain focused on progressing toward a definitive agreement with Stream.”
The TCDC campus is planned for a 438-acre site near Odessa, Texas. It is designed as a multi-phase development, with projected capacity exceeding 1 gigawatt over time.
Shares of New Era were up 6.7% on Wednesday morning.
