Halliburton Is Branching Into Data-Center Power Supplies as Frack Demand Stagnates

Halliburton Co. is diversifying into data-center power generation amid slackening worldwide demand for oilfield fracking.

The world’s biggest fracker has sealed a deal with VoltaGrid LLC to provide electricity generation to data centers, marking the company’s first major foray into powering the booming artificial-intelligence sector. The venture, initially focused on the Middle East, will provide turbines, reciprocating engines and proprietary VoltaGrid technology to data-center developers, the companies wrote in a statement.

Halliburton rose as much as 12% for the biggest intraday advance in more than five months. The stock was buoyed both by strong third-quarter results released earlier Tuesday as well as the AI-power venture, analysts said.

“Data center collaboration with VoltaGrid is a surprise and likely more impactful to stock” than better-than-expected earnings, Marc Bianchi, a TD Cowen analyst, wrote in a note to clients.

Halliburton, which before now had been mum on data-center opportunities, follows oilfield competitors Baker Hughes Co., SLB and Liberty Energy Inc. into the burgeoning industry. For its part, Liberty has surged more than 30% in the past four trading sessions since announcing plans to vastly expand its mobile power-generation unit.

“The demand for power and for AI is like nothing I’ve ever seen,” Halliburton Chief Executive Officer Jeff Miller told analysts and investors during a call on Tuesday.

With oil prices slumping in the face of a looming global supply glut, prospects for oilfield contractors are dimming from shale fields and deepwater drilling to wildcat exploration. Executives have also warned that blistering tariffs are squeezing them with soaring costs. Halliburton said that spending by North American oil clients is below so-called maintenance levels, or the minimum investments required to prevent crude production from declining, Miller said.