Bloom Energy and the Jupiter Notice: What Changed, and What Did Not

Disclaimer: This article is for informational and educational purposes only. It does not constitute financial, legal, or investment advice. Views are based on public information as of the publication date and are subject to change.

My set a probability-weighted target of $346 with the stock at $166.84. It listed four events that would break the thesis. One was a credit event or cancellation at the customer representing 73% of half-year revenue.

Since then, the stock rose 65% to $275.19. On September 24, Bloomberg reported that Oracle sent a force majeure notice to the developer of Project Jupiter, the 2.45 GW New Mexico campus Bloom is contracted to power. The stock closed at $266.65, down 3.1%.

This is not a cancellation. It is the first formal sign that Jupiter’s timeline is at risk.

This update covers four questions:

1. What does the notice do?
2. What is delaying the project?
3. How much of Bloom depends on it?
4. What changes in the model?

1) What the notice does

• Oracle cannot terminate the lease.
• The notice lets Oracle pay the lower development-stage rent for longer if power arrives late. Blue Owl, the developer, collects the full rent later.
• Blue Owl has about $3bn of equity in the project and says the financial commitments are unchanged.
• Oracle says the project is on schedule. The notice only protects Oracle if the campus misses its 2028 target.

Oracle is buying an option on delay. Companies do not buy that option on projects they expect to finish on time.

The tenant is also weaker than it was in July. Oracle spent $28.5bn on capex last quarter and reported free cash flow of negative $5.4bn. Its stock is at $139.53, against a 52-week high of $322.54. Oracle’s balance sheet is now part of Bloom’s risk.

2) The gas is not the problem

The first question I asked was whether southern New Mexico can supply this much gas. It can.

• The campus burns about 370,000 to 400,000 Dth per day at full load. The planned pipeline carries 400,000.
• The EIA forecasts Permian output at 29.2 Bcf/d for 2026.
• Waha gas trades near $2/MMBtu, and about 4.5 Bcf/d of new Permian takeaway capacity comes online this year.

The constraint is 17 miles of pipe. The lateral connects to the existing El Paso Natural Gas system. The New Mexico State Land Office twice rejected the 0.6 miles that crossed state trust land. On August 17, Energy Transfer rerouted the line onto federal land. The in-service date moved to February 1, 2027. A second planned lateral runs 50 feet away.

Trucking gas in is not an option at scale. Full load would need 450 to 480 LNG trucks a day. About 100 MW is the practical limit for a bridge.

3) The air permit is the real gate

• The New Mexico Supreme Court lifted its stay on the air permit case on September 17.
• The Environment Department has not appointed a new hearing officer.
• The decision deadline is November 23. Hearings will likely begin next year.

Without the air permit, the fuel cells cannot operate, whatever happens with the pipeline. First power in 2027 now looks unlikely. First power in 2028 remains possible.

Relocating the campus is not necessary for gas reasons. Management said on the Q2 call that units can be redirected to other sites and that the financier, not Bloom, is obligated to take delivery. Bloom’s exposure is timing and redeployment, not stranded inventory.

4) How much of Bloom is Jupiter

There are two answers, and they point in different directions.