Crusoe sells troubled Wyoming data center project to Google
The deal highlights the challenges of developing massive AI data centers.
Crusoe, a Denver-based data center developer, recently announced the sale of an unfinished data center project located in southeastern Wyoming to tech giant Google. The company, which had previously struggled to secure Google as a customer, sold the project to Google after concerns were raised about its cost and construction timeline under Crusoe's management.
Crusoe had initially announced the project last year in collaboration with Blackstone-backed infrastructure company Tallgrass, with plans to scale it up to 10 gigawatts of power capacity. The specific amount Google paid for the unfinished project remained undisclosed, but the company revealed plans to invest $17 billion in developing the data center campus.
This transaction underscores the challenges faced by independent data center developers in completing massive projects on time and within budget, particularly in securing equipment and power, as well as dealing with local opposition. Despite this acquisition, Google has not abandoned its partnership with Crusoe. The company is currently developing another data center for Google in Amarillo, Texas.
The deal to sell the Wyoming site to Google was initially reported by Bloomberg in June, though the Wyoming setback did not deter Crusoe from raising a $3.9 billion funding round in September. Crusoe generates revenue through leasing data center space to customers that provide their own GPUs, renting out its GPUs, and selling compute power used to run AI models, known as inference.
The company's largest projects include facilities for AI leaders such as Oracle, OpenAI, and Microsoft. Crusoe's Abilene, Texas campus is being built in phases for Oracle and OpenAI, while a separate 900-megawatt campus for Microsoft is under construction. Meta and the trading firm Jane Street are also among Crusoe's customers, with Meta reportedly signing a $13 billion, five-year cloud deal with the company.
Crusoe was founded by CEO Chase Lochmiller and Cully Cavness, who initially launched the business as a cryptocurrency-mining operation powered by natural gas. In September, Crusoe bolstered its board with three new members, including JB Straubel, the founder of Redwood Materials and a Tesla board member who invested in Crusoe in 2021.
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