By Laila Kearney
NEW YORK, Aug 11 (Reuters) - AI infrastructure company Alpha Compute has signed a binding term sheet to acquire land and natural gas rights in Pennsylvania for $55 million to develop a 200-megawatt data center campus, CEO Brittany Kaiser told Reuters on Tuesday.
Surging demand for artificial intelligence computing is driving a scramble for power supplies across the United States, prompting data center developers to secure their own energy sources rather than wait for grid connections.
Pennsylvania -- with its abundance of natural gas from the Marcellus shale basin, existing power infrastructure and proximity to major population centers on the East Coast -- has become one of the country's most sought-after locations for new data centers. Last year, Amazon announced $20 billion in planned investment in the state.
Alpha Compute expects the northern Pennsylvania site, which would include gas-fired power generation, to begin operating in the third quarter of 2027, Kaiser said. The facility could eventually be expanded to generate one gigawatt of power, Kaiser added.
The project would combine data center development with natural gas production and on-site electricity generation, an increasingly popular approach as utilities struggle to quickly connect large AI facilities to the grid. The deal would include undeveloped Marcellus gas rights covering about 1,800 mineral acres, Kaiser said.
The agreement gives the British Virgin Islands-incorporated company an exclusive option to acquire the assets, but the transaction remains subject to due diligence, financing, permitting and final agreements. Kaiser said she expects to close the deal after a 60-day diligence period. Details of the project have not been previously reported.
The project will also require local approvals at a time when some communities have tightened restrictions on data centers because of their electricity and water demands. Kaiser said local communities had so far been receptive to the proposal, whose exact location has not been disclosed.
While Alpha Compute has traditionally provided confidential-computing services, it is a recent entrant to data center development. The Pennsylvania project, if it moves ahead, would be the company’s first data center development in the United States.
After the initial $55 million investment, Kaiser said she expects the build-out of the data center campus, including electrical connections, to run about $500 million spread out over years.
Kaiser said potential users are interested in secure computing services that use end-to-end encryption and are commonly used by governments, militaries and increasingly private-sector organizations seeking to protect sensitive data.
(Reporting by Laila Kearney in New York; Editing by Sanjeev Miglani)
