Why It Matters
A proposal to build one of the largest data centers in the United States on Alaska’s remote North Slope could reshape the state’s economy — delivering construction jobs, permanent employment, and new revenue from land long valued primarily for oil extraction. The project would operate independently of Alaska’s urban power grid, a design choice that analysts say could shield residents from the electricity price spikes that data center development has triggered elsewhere in the country.
What Happened
Stak Energy has submitted a lease application to the Alaska Department of Natural Resources for a massive data center complex covering roughly one square mile along the Dalton Highway corridor, about 25 miles south of the North Slope’s main oil infrastructure. The state issued a preliminary decision this week that the project is in Alaska’s “best interest” — a required step before a 50-year land lease can be finalized.
The Alaska Department of Natural Resources solicited competing bids after Stak filed its lease application in November. No competing proposals were submitted, and the agency is now moving forward with a public comment period open through June 15.
Stak’s founders describe the company as Alaska-rooted, and the firm has made a series of high-profile hires in recent months, including former Alaska Natural Resources Commissioner John Boyle and a former department aide. The company’s CEO, Sparrow Mahoney, is an Alaska native who attended Wasilla High School.
By the Numbers
- $500 million — Stak Energy’s estimated investment in the project
- 3 gigawatts — potential peak power output for the facility’s own operations, placing it among the largest data centers under development nationwide
- 1,500 workers — projected peak construction workforce, with roughly 60 permanent positions afterward
- 7 million cubic yards — gravel needed to elevate the facility’s structures off the tundra, nearly twice the amount authorized for ConocoPhillips’ Willow oil project
- 90%+ — projected reduction in water consumption compared to industry norms, achieved through air cooling made possible by the region’s average annual temperature of 12 degrees Fahrenheit
Key Advantages — and Unresolved Questions
Stak argues its North Slope location offers structural advantages that southern developments cannot match. The extreme cold allows air-based cooling systems to operate without the enormous water consumption that has drawn fierce opposition to data centers in other states. A water challenge facing many regions of the West makes this distinction increasingly significant for developers seeking community and regulatory approval.
The facility’s projected power needs are extraordinary — more than double the natural gas consumed by urban Alaska for electrical generation and heating combined. A new pipeline would be required to deliver that gas, with estimates placing its length anywhere from 25 to 90 miles depending on which North Slope petroleum field supplies the fuel. That wide range, according to Antony Scott, a former commercial petroleum analyst for the state, signals that a firm gas supply agreement has not yet been secured.
“That means they don’t have a gas supply,” Scott said, though he noted the remote location insulates the project from broader grid pressures. On the North Slope, he added, developers “can just step into this friendly environment.”
A separate challenge involves equipment procurement. Natural gas-powered turbines needed to generate the facility’s electricity face manufacturing backlogs of up to seven years due to surging nationwide demand. Stak says it is targeting initial operations in 2028, a timeline that energy analysts view as ambitious given current supply constraints. Similar infrastructure debates over data center development — including concerns about power supply, local impact, and permitting — have emerged in communities across the country.
Environmental and Carbon Questions
Because the project would run on natural gas rather than renewable energy, it stands apart from data center developments by some major technology firms pursuing carbon-reduction targets. Stak says it is monitoring carbon capture technology but acknowledges that limited regional infrastructure and incomplete geological understanding of the area present near-term obstacles to reducing emissions.
Before construction can begin, the company must also secure a federal Clean Water Act authorization to build the gravel pad that would elevate its structures above the tundra.
What’s Next
The public comment period on Alaska’s preliminary leasing decision runs through June 15. After that window closes, the state will weigh feedback before moving toward a final leasing decision. Stak will then need to complete additional federal permitting before any ground is broken. Governor Mike Dunleavy’s administration has been an active proponent of establishing a data center industry in Alaska, and the preliminary approval reflects that policy priority.
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