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SOUTHERN NEW MEXICO

Land commissioner nixes Project Jupiter pipeline for second time

Proposed Sierra County project also under scrutiny

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For a second time, New Mexico Commissioner of Public Lands Stephanie Garcia Richard denied a request to grant rights-of-way and a lease to build a natural gas pipeline through state trust land to service Project Jupiter.

State Land Commissioner Stephanie Garcia Richard in her office in Santa Fe.

Project Jupiter, a hyperscale data center under development for use by Oracle and OpenAI to train artificial intelligence models, has been under construction in Santa Teresa since September.

In March, Garcia Richard rejected an application from Texas-based natural gas company Energy Transfer to build a 17-mile, 24-inch pipeline extension from El Paso to fuel a microgrid that would power the data center.

Dubbed the 鈥淕reen Chili lateral,鈥 an apparent reference to green chile, the pipeline would cross federal and private lands as well as a stretch of state trust land in Do帽a Ana County. The company had requested a five-year lease.

On Tuesday, Garcia Richard rejected a request by the company to reconsider her earlier decision, saying it had properly filed applications and required fees for the project. Garcia Richard鈥檚 letter explained that approvals are subject to her discretion.

鈥淭he Commissioner 鈥 is under no obligation to issue any lease, right-of-way, or permit to any party, and properly does so only upon determining that a given lease, right-of-way, or other authorization is in the best interests of the state land trust which the Commissioner serves as a fiduciary,鈥 Garcia Richard wrote in her letter.

A conceptual rendering of the AI-training data center known as Project Jupiter under construction in Santa Teresa.

The State Land Office manages over 13 million acres of state land for lease revenue benefiting New Mexico schools, higher education institutions, hospitals and other institutions.

The commissioner is an elected position, with Garcia Richard, a Democrat, nearing the end of her second four-year term. She is currently in the running to replace fellow Democrat Maggie Toulouse Oliver as the party鈥檚 nominee for lieutenant governor, after Toulouse Oliver withdrew her candidacy. The Democratic Party State Central Committee is scheduled to choose the nominee later this month. Garcia Richard was endorsed by Deb Haaland, the Democratic candidate for governor in November鈥檚 election.

Garcia Richard argued that the pipeline would generate 鈥渕inimal revenue鈥 for the state: nearly $32,000 in one-time payments for the rights-of-way plus approximately $217,000 over five years earned from the business lease.

Continuing, the letter argued that while Project Jupiter 鈥渦ndoubtedly will enrich鈥 the project鈥檚 backers, the benefits to the land trust were unclear.

Since Energy Transfer鈥檚 initial application, Oracle announced a revised plan for its microgrid, moving from natural gas turbines to fuel cell technology.

According to a revised air quality permit application, however, greenhouse gas emissions were still estimated at 10.1 million tons annually 鈥 lapping yearly emissions from the Albuquerque metropolitan area. Critics, including some local state lawmakers, have called for massive solar energy deployment instead.

鈥淭he burden that the project will impose on New Mexico鈥檚 water and other natural resources, and on the surrounding community, is extreme,鈥 Garcia Richard鈥檚 letter stated. 鈥淭his includes the negative impact that greenhouse gas emissions play in driving climate change, which effects (sic) the health and productivity of state trust lands throughout New Mexico.鈥

Energy Transfer has an administrative right to contest the decision. A spokesperson for the company told the Journal, 鈥淲e continue to work through the permitting requirements as we move the project forward.鈥

Oracle issued a statement Wednesday evening highlighting the project鈥檚 promises for construction and operational jobs and touting investments committed to by the developers for local water infrastructure. 

"Our new power strategy significantly reduces emissions compared to our prior power plan,鈥 the statement continued. 鈥淥racle is aiming to cover 100% of the electricity used by our AI Data Centers with carbon-free energy by 2035 鈥 10 years ahead of the 2045 net-zero goals set forth in New Mexico鈥檚 Energy Transition Act. The project remains on-schedule, and we continue to work closely with our partners and New Mexico's public officials to move Project Jupiter forward.鈥

Spaceport data center proposal

The decision came as residents of Sierra County have raised questions about a potential data center development, unrelated to Project Jupiter, on state trust land occupied by Spaceport America outside Truth or Consequences.

Residents listen during a town hall about a proposed Green Data Center project in Socorro.

The spaceport confirmed that it has been in talks with developers of the proposed Green Data Center project, which recently pursued a partnership with New Mexico Tech to build in Socorro. Public controversy put a halt to the project earlier this summer and prompted Socorro County commissioners to enact a one-year moratorium on local data center development.

Talks between Green Data Center鈥檚 developers and the spaceport preceded the Socorro proposal, a spokesperson for the spaceport said. In 2025, the spaceport 鈥 built on state trust land under a long-term lease 鈥 requested permission to sublease a total of 19 acres in its horizontal launch area to Aetherion Inc., the Green Data Center developer.

State Land Office spokesperson Joey Keefe said the sublease request remained under review and has not been approved.

鈥淐ommissioner Garcia Richard has serious concerns about the tremendous strain that some data centers put on water systems and other natural resources,鈥 Keefe added. 鈥淎ny data center projects that proceed must have robust environmental guardrails in place and need to provide a clear, net benefit to the local community.鈥

Algernon 顿鈥橝尘尘补蝉蝉补 is the Journal鈥檚 southern New Mexico correspondent. He can be reached at adammassa@abqjournal.com.