Fermi America Ends TensorWave Lease Deal
The lease termination comes as Fermi advances agreements with an undisclosed investment-grade hyperscaler.
Updated on Nov. 13, 2026 in Data Centers
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Fermi America has terminated its lease agreement with TensorWave, a deal announced in August 2026. The company said it is developing agreements with an undisclosed investment-grade hyperscaler, including a $200 million prepayment for 600 megawatts.
Why it matters
Hyperscaler demand for large-scale data center capacity in Texas has grown as power scarcity, state moratoriums and ERCOT's freeze on new large-load connections limit alternatives. For Texas residents, the Project Matador expansion also raises community questions about water, noise, light and the natural environment.
Fermi reported a $15 million early construction and site development agreement and a $90 million structural steel and building materials purchase agreement tied to the hyperscaler deals. The company targets initial power availability in late Q2 or early Q3 2027 across its planned 2.2 gigawatts of capacity.
The players
Fermi America
Fermi America is a company developing the Project Matador data center campus in the Texas Panhandle, and it has invested over $1.6 billion in the site.
TensorWave
TensorWave is a company that had a lease agreement with Fermi America for capacity at the Project Matador site before the agreement was terminated.
Lee McIntire
Lee McIntire is a public figure connected to Fermi America's Project Matador development, as reported in the extraction.
ERCOT
ERCOT is the Electric Reliability Council of Texas, the grid operator that has frozen new large-load connections and shapes power availability for data centers in the state.
The details
Fermi announced the hyperscaler agreements during its third-quarter earnings call with investors. The company's land now includes around 8,400 acres acquired, leased or under option, and its environmental impact statement comment period remains open through November 23.
Timeline
August 2026: TensorWave agreement was announced.
March 2026: Project Matador expansion to 7,570 acres was announced.
October 2026: Environmental impact statement was posted.
November 13, 2026: Third-quarter earnings call and Panhandle board meeting.
November 23, 2026: Public comment period on the environmental statement closes.
The Tech Race
Hyperscaler competition for power-ready sites has intensified as ERCOT's freeze on new large-load connections limits available capacity in Texas. Fermi's shift toward an investment-grade hyperscaler reflects how developers are reorienting their deals around grid access rather than land alone.
Residents near Project Matador and in nearby communities such as Amarillo and White Deer may see changes tied to groundwater transport, noise and light from the campus as construction advances. Anyone wishing to weigh in on the environmental review can submit comments before the November 23 deadline.
The takeaway
Power access, not land alone, is increasingly determining which data center projects move forward in Texas. Community input on water, noise and environmental impacts remains part of the approval process before the campus can proceed.
What happens next
Fermi is targeting initial power availability late in the second quarter or early in the third quarter of 2027, and the public comment period on its environmental impact statement closes November 23, 2026.
Further reading
For broader context on how power constraints are reshaping site selection, explore Data Centers coverage across Texas.
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Should your community welcome new AI data centers despite water and power concerns?
