Fermi Signs 222 MW Data Center Lease Agreement with TensorWave

Fermi Inc. announced on August 10 that its subsidiary, Fermi Campus 1 LLC, has signed its first binding customer lease agreement with TensorWave TEX1, LLC, a subsidiary of AI cloud service provider TensorWave Inc. The agreement covers the "Project Matador" campus in Carson County, Texas, with an initial phase capacity of 222 megawatts.

Under the agreement, Fermi will be responsible for the development, construction, and delivery of the data center facilities, with TensorWave taking occupancy in phases. The facility is scheduled for phased delivery starting in the second half of 2027, with a 15-year initial lease term commencing upon the start of the final delivery phase, along with two renewal options of five years each. Fermi estimates that the initial phase agreement will generate approximately $6.5 billion in contracted revenue over the initial 15-year lease term.

Fermi stated that upon full delivery, the facility is expected to support tens of thousands of next-generation AMD Instinct GPUs for large-scale AI training and inference. The agreement also includes expansion rights for two additional data centers, which, if exercised, would bring the total collaboration capacity to over 650 megawatts. The lease arrangement remains subject to customary conditions, including obtaining necessary project guarantees and financing. Fermi stated that it expects a global AI-focused enterprise to provide guarantees for certain obligations under the agreement.

"Project Matador" has a planned total power capacity of approximately 17 gigawatts, of which about 6 gigawatts have already been approved. Fermi stated that over $1.5 billion has been invested in the project to date, with first power delivery expected in 2026. The campus is located in the Texas Panhandle and is intended to provide large-scale power for AI and advanced computing facilities through a privately owned and operated on-site power grid.

Fermi disclosed that "Project Matador" is expected to integrate combined-cycle natural gas generation, new nuclear power projects, utility grid power, solar energy, and battery energy storage systems in the future. The company stated that the project will be progressively developed toward approximately 17 gigawatts based on binding customer agreements and commercial progress.

Darrick Horton, CEO and co-founder of TensorWave, stated that power supply is a critical constraint in AI infrastructure development, and that TensorWave customers have significant demand for next-generation AMD Instinct GPUs that must be delivered on schedule. Fermi, for its part, stated that it continues to engage in discussions with additional cloud and enterprise computing customers, as well as campus development, construction, and financing partners, regarding capacity at "Project Matador."

The Texas Tech University System has informed Fermi that it supports the transaction and plans to collaborate with Fermi to advance its completion. Fermi stated that further details will be disclosed once the relevant agreements are finalized.