Texas Pacific Land Corporation (NYSE: TPL) has reached an agreement with Chevron U.S.A. Inc., a subsidiary of Chevron Corporation (NYSE: CVX), to provide land and brackish water resources for a large-scale power generation facility in Reeves County, Texas.

The project, known as Project Kilby, involves a power generation facility Chevron is developing to support a customer data center. Under the agreement, TPL contributed surface acreage in exchange for cash consideration and the exclusive right to source aquifer-derived water for the facility and other associated aspects of the project.

TPL plans to supply brackish groundwater, which the company said would help reduce demand for shared freshwater resources in the Permian Basin. The company also said it continues to develop solutions for reuse of desalinated produced water from oil and gas operations.

"By securing access to land and reliable sources for non-potable brackish water supply, engaging openly with the community, and working closely with trusted long-term value chain partners such as TPL we aim to support economic growth while respecting the importance of water stewardship in West Texas," said Daniel Droog, Vice President of Power Solutions at Chevron.

TPL Chief Executive Ty Glover said the Permian Basin's resources, skilled workforce, and regulatory environment position the region as a location for compute infrastructure, adding that TPL is positioned to support that growth through its surface footprint and access to energy and water resources.

Texas Pacific Land Corporation is one of the largest landowners in Texas, with most of its holdings concentrated in the Permian Basin. The company is not an oil and gas producer but generates revenue through land use fees, water sales, royalty interests, and easements, according to the press release.