TeraWulf AI project lease gives Google path to ownership stake in Kentucky data center

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Highlights

TeraWulf disclosed a 20-year, $19 billion lease deal with Google and Anthropic for 401 MW of computing capacity at its Kentucky campus.
Google can step in as tenant if Anthropic defaults and may acquire an ownership stake in Raylan Data equal to the percentage of project cost it pays as a termination fee.
Google's support for the project lasts until Anthropic or its affiliates hold an investment-grade credit rating for three months, with phased deliveries running through Q2 2028.

Lease structure supports $19 billion project financing

According to CoinDesk, as disclosed in a Wednesday filing, TeraWulf said Google and Anthropic agreed to a 20-year, $19 billion lease framework covering 401 megawatts of computing capacity at the company’s Kentucky campus. The arrangement is designed to help TeraWulf secure financing for the project, with initial capacity expected to begin coming online in late 2027.

Under the agreement, Google backs Anthropic’s obligations and can step in as tenant if Anthropic defaults on rent or becomes insolvent. In certain circumstances, Google can also pay a termination fee and acquire an ownership stake in Raylan Data, the TeraWulf subsidiary that operates the project.

The size of any stake depends on the amount Google pays relative to the facility’s total development and construction cost, including land, infrastructure, equipment and financing. TeraWulf said a termination payment equal to 30% of the total project cost would translate into a 30% ownership stake in the subsidiary.

AI pivot deepens as delivery runs through 2028

Google is generally required to assume the lease rather than terminate it during the first six years after its support becomes effective. An exception applies if the TPU pods installed in the data halls, Google’s own AI chips, can use less than half of the power reserved for the tenant.

The support obligations end if Anthropic, or a parent or subsidiary, maintains an investment-grade credit rating for at least three months. The agreements were signed on Nov. 4, and Google’s backing for each of the three leased sections begins only after the final data hall in that section is delivered, with TeraWulf expecting deliveries to continue through the second quarter of 2028.

For TeraWulf, the Anthropic contract marks one of the largest agreements in its shift away from a business built around bitcoin mining toward supplying power and infrastructure for AI companies. Any ownership Google could obtain would be in the project subsidiary Raylan Data, rather than in publicly traded TeraWulf itself.

Our earlier coverage of the U.S. AI data center buildout highlighted mounting pressure from high financing costs, construction delays, and power-grid constraints that are making large projects harder to deliver on time. We noted that investor confidence is increasingly tied to whether developers can secure capital before revenues start, control cost overruns, and overcome local and regulatory pushback as they scale computing capacity.

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