West Texas has a vast amount of natural gas that could power artificial intelligence data centers. However, the region lacks adequate infrastructure to convert the gas into electricity and transport it efficiently.
The lack of pipeline infrastructure puts West Texas at a disadvantage compared to other oil-producing regions in Texas. Companies like FrontierGen are working with industrial developers to secure land and overcome this hurdle. The industry needs an additional 400 terawatt-hours of energy by 2028 to meet AI demand.
Oil companies are investing billions of dollars in gas plants, but more pipelines are needed to transport the natural gas. The federal government should reform pipeline permitting to shorten the approval process.
The Permian Basin Reliability Plan aims to build transmission lines capable of transmitting higher voltages of electricity by 2030. This plan could help West Texas turn a financial drain into profit and compete with other regions for customers seeking massive amounts of natural gas.
Source: https://www.texastribune.org/2025/09/23/west-texas-gas-ai-data-centers