CleanSpark expands its Texas footprint for data center project
When CleanSpark (CLSK) announced late last year that it was pivoting from a pure-play bitcoin miner to AI data center infrastructure services, it was a signal of not just of the enormous opportunity in the booming artificial intelligence sector, but also the growing challenges faced by bitcoin miners to turn a profit.
CleanSpark moved aggressively in this new operational direction, acquiring the rights to roughly 271 acres of land in Austin County, Texas and securing 285 megawatts of long-term power supply agreements.
And now the company has doubled down on its AI ambitions by entering into an agreement to acquire up to 447 acres of land in Brazoria County, Texas, as well as a long-term transmission facilities extension agreement.
Terms of the agreement were not disclosed.
CleanSpark said that the new land acquisition is positioning it to launch a large-scale data center project with transmission-level power enabling a 300 MW demand load. There is also potential capacity for further expansion of up to 300 MW totaling 600 MW, the company noted.
Like its other piece of land in Texas, this latest one is located just outside of Houston, the fourth-largest city in the United States.
The two sites can provide an infrastructure hub with more than 890 aggregate megawatts of potential utility capacity.
"The demand for scaled, AI-native compute continues to accelerate, and access to transmission-level power in strategically advantageous regions has become increasingly constrained," CleanSpark chairman and CEO Matt Schultz said in a statement. "This agreement underscores our ability to source and secure high-quality power at scale while building regional density that is highly attractive to leading AI and compute customers."
The company said that it expects to "continue advancing its Texas development portfolio" while also meeting with potential co-location and compute partners that are seeking large, scalable data center campuses.
"As we advance our development pipeline, our focus remains on creating durable infrastructure platforms capable of supporting long-term, multi-phase growth," Schultz added.
With its massive land space, Texas has become a highly attractive site to build data centers in the US, with statistics showing about 383 facilities already located there.
Jeff Thomas, senior vice president of AI data centers at CleanSpark, called the Houston area "one of the most important power markets in the country," noting that its latest land purchase has it approaching a gigawatt of total potential capacity in the region.
The Nevada-based company has said that its move into the AI data center space will follow the "vertically integrated ‘infrastructure-first’ model” that it has used with its bitcoin mining business in order “to unlock value across its land and power portfolio.”
Although the company is building out its AI and high-performance computing business, it is not abandoning bitcoin mining.
Northland analyst Mike Grondahl initiated coverage of CleanSpark on Tuesday with an Outperform rating and a price target of $22.50.
Grondahl said in a client note that he sees "multiple tailwinds from BTC mining scale and emerging HPC demand" for CleanSpark.
"With multiple potential tenants pushing to secure power, we believe there are abundant opportunities for CLSK to secure HPC leases on very attractive terms in the near to medium term," he said.