New Era Energy & Digital (NASDAQ:NUAI) released second-quarter financial results and hosted an earnings call on Monday. Read the complete transcript below.
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Summary
New Era Energy & Digital reported cash reserves of $84.8 million and an undrawn facility of $270 million, sufficient for TCDC Phase One equity contribution.
Construction permits for the TCDC site are in hand, reducing development risk, with site grading to commence soon.
Phase Two power capacity increased to 550 MW, bringing total capacity to 757 MW across Phases One and Two.
Significant team expansion with hires from industry leaders like Microsoft and AWS, enhancing project execution capabilities.
Support for Texas's directive on data center development, emphasizing dedicated generation and water-efficient design.
Finalization of a Power Purchase Agreement (PPA) underway, expected to enhance leverage in tenant negotiations.
Plans for future growth include modular data centers and larger-scale sites, with a focus on disciplined capital allocation.
Full Transcript
OPERATOR
Good day, and thank you for standing by. Welcome to New Era Energy & Digital second quarter 2026 earnings conference call. At this time, all participants are in a listen-only mode. After the speakers' presentations, there will be a question-and-answer session. To ask a question during this session, you will need to press star-1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star-1-1 again.
Please be advised that today's conference will be recorded. I would now like to turn the conference over to your first speaker today, Lincoln Tan, Investor Relations for New Era Energy & Digital. Please go ahead.
Lincoln Tan, Investor Relations
Thank you, operator, and good afternoon. My name is Lincoln Tan, Investor Relations for New Era Energy & Digital. Thank you for joining New Era Energy & Digital's second quarter business update call. Joining me today are Charlie Nelson, Chairman and CEO; Ted Warner, President and CFO; Jose Rodriguez, COO; and Evan Pierce, Chief Development Officer. Before we begin, I'd like to remind everyone that today's call is being recorded and will be available on the Investor Relations section of our website.
Please note that during the course of this call, we may make forward-looking statements. These statements reflect our current views and expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied. Please refer to Slide 2 of the accompanying presentation and our SEC filings, including our Form 10-Q filed on Friday, for more information. With that, I'll now turn the call over to Charlie Nelson.
Charlie Nelson, Chairman and CEO
Thanks, Lincoln, and thanks everyone for making the time. I want to start with the headline because I think it's a simple one. This quarter, our focus has been on the parts of this project where the outcome sits with us rather than with the counterparty. That means permitting, land, and site works. This quarter we delivered on them. We now have our construction permits in hand, and we believe that that meaningfully reduces the development risk at the site.
We expect to begin site grading in the coming weeks. Our phase two power partner has also filed a standard air permit supporting approximately 550 megawatts. This takes TCDC phases one and two together to roughly 757 megawatts of gross capacity. On the commercial side, tenant negotiations in the joint venture with STREAM continue to advance, along with phase one power arrangements. The one I would highlight today is power. In early July we were given the opportunity to step in and negotiate a PPA in our own name, and we are currently finalizing that PPA after a period of negotiations.
On the balance sheet, we finished the quarter with $84.8 million of cash, and we have $270 million undrawn in the facility. This more than covers our expected TCDC phase one equity contribution, and Ted can cover this more in detail later. And then there's the team, which I want to spend a minute on because I think it's the one thing that's changed the most about this company in the last quarter. So when you look at this page, what I'd ask you to notice isn't the number of names, it's where they've come from.
First, we have Jose Rodriguez, our Chief Operating Officer, who has run data center engineering and critical environment operations at Microsoft, AWS, and TikTok. And earlier in his career, he led engineering teams across gas turbine and nuclear power at GE and TVA. He's built and operated the kind of facility that we're building. Then we have Evan Pierce, who joined as Chief Development Officer in June. Twenty years in hyperscale data centers and energy infrastructure, most recently running site and energy development for the Americas at EdgeConneX.
He also comes from AWS and TikTok as well. He's helped us plan and deliver more than 5 gigawatts of capacity. We've got Michael Johnson, who joined at the same time as Evan, and he joined as General Counsel and Chief Compliance Officer. He's got 30 years of legal and commercial work under his belt, and it's in this asset class. Most recently he was at CoreWeave and, before that, Switch, covering leasing, powered land acquisition, and construction contracting.
Ted Warner — you know Ted — took on the expanded role of President, Chief Financial Officer in June and recently joined our board. We've got Darren Ovel, who's our Chief Accounting Officer, and Andy Cazza as our Chief Corporate Officer. And finally, Will Gray, who founded this business, as you know, and took it from an idea to a listed company and is now the President of the Permian, where his relationships with landowners, operators, and the local community here are invaluable.
Beyond our C-suite hires, we've also expanded capability across management, which includes the additions of James Shapard, our VP of Site Selection, and Morgan O'Connor, our VP of Construction. James joins us from HDR, a global engineering firm in the data center space. And Morgan joins us from AWS, where she is the Senior Manager of Construction. A project like TCDC is won or lost on execution, and you need people who have done it before. Six months ago, we were a company with a very good site.
Today we're a company with a very good site and a team that's built this before, and I'll say plainly, it's a privilege to lead them. Turning to the next page, I want to address the Texas backdrop entirely. Governor Abbott has recently issued a directive calling for stronger oversight of data center development in Texas — more transparency on power and water requirements, on infrastructure costs, on ownership, and on community impact. The principle behind this is that large-scale development should bring additional energy to Texas rather than push costs and burden onto Texans.
We put out a release this week supporting it. I'd like to make the point plainly: we're not supporting this because we've been asked to. TCDC and our entire business were designed this way from the start. On power, our strategy is built around dedicated generation, including behind the meter. We are not competing for constrained grid capacity. We're supplementing Texas power, not drawing it away from anyone. On water, the design prioritizes closed-loop liquid cooling and reclaimed water, and we're evaluating independent and wastewater solutions to keep produced water in productive use in the Permian — that matters.
On community, we've got jobs, training, local programs, and community impact programs, and Evan can cover this more in detail. And on transparency, we're committed to engaging openly as the state's processes move forward. We think clear and higher standards are good for the industry and, frankly, good for us because we're already building to them. And finally, one related point, phases one and two are islanded and behind the meter, so they are not dependent on ERCOT bases.
The broader point here is that behind-the-meter designs answer the concerns behind the Governor's directive structurally rather than through mitigation. That was a design choice made long before this directive, and it is increasingly what large customers are looking at. And with that, I'll hand it over to Jose to take you through the power positions across phase one and two.
Jose Rodriguez, Chief Operating Officer
Thanks, Charlie. Our flagship TCDC site is situated on 492 acres of owned land outside Odessa in Ector County. That puts us in the middle of the Permian Basin energy corridor. We sit adjacent to generation assets operated by Vistra and Calpine, with access to existing energy, water, and fiber infrastructure. We have a phased development plan that scales towards 1.4 gigawatts over time. The important word there is phased. We are not trying to build 1.4 gigawatts at once, and we're not funding it that way either.
Power is the constraint of this industry right now, so let me be specific about how we structure ours across phases one and two. Phase one is 207 megawatts. Power comes from existing generation adjacent to the campus, islanded and behind the meter, gas. What that means, practically: no ERCOT interconnection required and no air permit required for phase one because there is no onsite generation. We are not standing in an interconnection queue for power.
That is the single biggest reason we can move on the timeline we're talking about. What has changed this quarter is that we're working on finalizing the phase one PPA in New Era Energy & Digital's own name. Structuring in our name provides a direct path to power and further de-risk the project. Phase two adds approximately 550 megawatts, up from the 450 megawatts previously contemplated. The increase reflects different generation equipment and more effective emission controls, which lowers emissions per megawatt and allows more capacity within the same emission ceiling.
That's behind-the-meter gas again, this time on the TCDC site, with physically diverse gas supplies across three pipelines. We have partnered with Thunderhead Energy Solutions to deliver this power solution, and a subsidiary of Thunderhead has filed for the standard air permit applications with the TCEQ. Turbines are in order through Turbinex. Taken together, that's approximately 757 megawatts of gross capacity across phases one and two, against the roughly 650 megawatts previously contemplated.
The campus remains master-planned to scale towards 1.4 gigawatts over time. With that, I'll hand over to Evan to take you through what actually moved on the ground this quarter.
Evan
Thanks, Jose. Starting with permitting, this has been a core focus for the team this quarter. We are pleased to confirm the receipt of two key permits from Ector County, the Development Structure Permit and the Drive Approach Permit. The Phase One plat has also been submitted to both Ector County and the City of Odessa and we have now received approval of the notice of intent to TCEQ to commence grading. We are looking forward to crews being on site in the coming weeks to begin erosion control and site grading.
Touching briefly on the land and title, we flagged the 54-acre corridor acquisition at our previous update and we are pleased to report that that has now successfully closed. That corridor matters more than the acreage suggests because it's what lets us structure power directly and optimize the site layout. This takes us to 492 acres, which is all the land we need for the planned development now secured. We note that Phase One and Phase Two will require less than half of our current acreage on the air permit.
The only thing I'd like to add to Jose's point is timing. Because our application has followed the standard Texas state guidelines, we expect an expedited review process. In our experience, this has typically involved a one- to two-month review process as opposed to an 18-month timeline for major source review. Moving to the operator surface waivers, we've been progressing this in the background and we are now awaiting a final surface waiver from a single leasehold operator.
And finally, pipeline removal. We've removed 22 abandoned pipes across 12 rights of way, clearing legacy oilfield infrastructure across the site. We continue to progress further removals with the operators. To summarize, these are the work streams that sit with us rather than a counterparty and we've made solid progress. Land secured, site development, permits in hand, key documentation filed, and moving towards the beginning of construction. And now we have to push through it.
The people running this have built this at this scale before, so we're not figuring it out as we go. It's heads down from here. Turning to the next page, I want to spend a moment on the community because I know it is in front of the mind of many of our investors. There are counties and municipalities across the country putting moratoriums on data center development and the fair question is whether we're exposed to that here. First, I'd like to start with where we're located.
Ector County is an energy-producing county. This is a working industrial region. We are not dropping our campus in a residential suburb. And I would like to personally thank Ector County, including the Ector County Judge and Commissioners, for being such great partners in this project. If not for their guidance and support, this project would not be possible. Then there is the design approach we are taking. Most of the opposition you read about data centers rely on two key issues.
One, residential concern about their power bills; and two, residential concerns about their water. Our power is dedicated and behind the meter, so we are supplementing Texas power rather than competing for grid capacity. And we are not putting pressure on residential rates. Our cooling is closed-loop and prioritizes reclaimed water. Once the initial system is charged, water losses due to ongoing evaporation are minimal. We are also evaluating independent wastewater solutions to keep reused water in productive use.
So are we seeing organized opposition? Not really. We're getting questions rather than opposition. And they're mostly people wanting to understand exactly what's being built. We'd much rather answer those questions early than late. And that's why the engagement here is done in person by our senior team rather than delegated out. That means the mayor, the county judge, the Rotary Club, and local business owners. If you're asking a community to trust the project size, turning up yourself is the least you can do.
Our approach to development at TCDC is with the community, not around it. On the economic opportunity, this project is expected to create jobs and training opportunities through construction and operation. We're using local procurement and local companies, and once complete, TCDC will be a meaningful contributor to the local tax base. But that's what any development of this scale should deliver and, taken alone, I don't think that earns you an endearing place in the community.
So we've also committed to supporting broader community initiatives. These include library programs in Odessa and funding after-school childcare for working families. They'll serve people irrespective of whether they work for us or not. As we've said publicly, we intend to be part of the community and not just an investor in it. I'll now hand over to Ted to talk through the commercialization pathway and our approach to funding.
Ted Warner (President and CFO)
Thanks, Evan. Tying it all together, we are pushing forward on four parallel work streams to commercialize TCDC and progress towards construction commencement. Power, as we spoke about earlier, underpins any data center development and we are working towards finalizing the PPA in our own name. Permitting, as Evan covered, is progressing to plan, and significant progress has been made this quarter on the joint venture with Stream. We're continuing to finalize definitive documentation.
This encompasses the development, financing, and ongoing operation of the campus. Finally, on the leasing work stream, recent events have highlighted the strategic value of behind-the-meter assets such as TCDC and we continue to have constructive engagement with potential tenants. I want to walk through the funding structure carefully because it continues to be an area where we receive a lot of questions, understandable given the capital intensity of data center developments.
Let's start with liquidity. At June 30th we had $84.8 million of cash, cash equivalents, and restricted cash. This is actually an increase from our last reported number despite our burn and significant capex at TCDC. This is mainly due to the exercise of a significant amount of cash-paid $2 strike warrants during Q2. Then the Macquarie facility. It's an up to $290 million project facility with a three-year maturity and it's staged. Term Loan A1: $20 million is drawn.
That was at our close on April 7th. Term Loan A2: $30 million is available pre-lease at Macquarie's discretion. Term Loan A3: $40 million and the $200 million delayed draw both sit behind conditions precedent, the main one being a final lease making those two chunks of capital available. So that's $270 million remaining undrawn on that facility. Two things I'd stress about the facility: it's not balance sheet cash and it is not an obligation to draw.
We see this as the right structure for a project at this stage, where tranches unlock as we hit milestones. It gives us maximum flexibility if we have needs for immediate capital, especially post-lease. Moving on to what funds what: parent-level liquidity funds operating costs and early development. And together with the Macquarie facility it more than covers our expected TCDC Phase One equity contribution. Our current cash position covers multiple years of burn at our current rate.
Project capital, the larger number, gets raised at the asset level after lease execution, targeting roughly 80% debt, which we'll be funding at the JV level. We are not funding multi-billion-dollar capex at the parent level. Beyond that, we continue to develop non-dilutive funding paths. We have strong relationships with leading credit funds that could support both pre- and post-lease development, power contracts, land, and long lead-time procurement.
There are also equipment finance options where lending is secured against hard assets like electrical and data center infrastructure. The last point I'd make about discipline and capital allocation. We've assembled a strong team that is clearly capable of growing New Era Energy & Digital beyond just a single site and the pipeline of opportunities in front of us keeps building given their networks. However, our default position is to stay focused on TCDC, be disciplined with our capital until the key milestones there are executed.
If something genuinely compelling came to us and it could be structured so it wouldn't materially compete with TCDC for our near-term capital, of course we would do the work and look hard at it. To us, an accretive deal on top of TCDC would be defined as something that would require an immaterial amount of cash in the near term and would result in NLI far sooner than TCDC, likely from smaller inference sites, which we want to be a big part of our future growth profile.
The point here is the bar is high and right now the team remains firmly in TCDC execution mode. With that, let's open the lines for some Q&A.
OPERATOR
Thank you. At this time we'll conduct a question and answer session. As a reminder, to ask a question, you'll need to press star-11 on your telephone and wait for your name to be announced. To withdraw your question, please press star-11 again. Please stand by while we compile the Q&A roster. And our first question comes from the line of Mike Grundall of Northland. Your line is now open.
Mike Grundall, Analyst at Northland
Hey, thanks, guys, and congratulations on all the progress. Busy summer, obviously. Can you talk a little bit about the process to get the PPA and kind of the likelihood you can get it, and give us some sense for timing?
Ted Warner (President and CFO)
Yeah, we can talk about the process there. You know, the—I mean, basically it just comes down to contracting. And so, you know, as far as the progress there, you know, the contracts are materially drafted, things agreed to—that it's just coming down to approvals at this point, and obviously it's a sensitive commercial undertaking right now, so I can't exactly tell you all the details on that. But PPA is a contract like anything else, so we've just been going through the contracting process.
Yeah, Mike, we've been working on that for a long time, and it's substantially in its final form in our opinion, so we feel like we're in a good place there.
Mike Grundall, Analyst at Northland
Great. Okay. And given that you guys own the land, you're in this process of getting that PPA as well, you know, it feels like you're going to have some leverage in negotiations. Has there been other tenants or development partners that have shown interest in the site, or is it still just kind of that original IG hyperscaler?
Ted Warner (President and CFO)
I mean, they're still there, but yeah, we've had interest from pretty much every potential major tenant you could want. I mean, especially with the recent announcement from the governor's office, our site has become even more attractive due to the fact that you pretty much already meet all those standards. And yeah, that's been great. So, yeah, the PPA in our name is a great thing for leverage, but honestly, our plan is still to try to move forward with the guys that we've been rowing this boat with for the last four months.
Mike Grundall, Analyst at Northland
Got it. And then I think lastly, you guys called out in the press release that the 757 megawatts gross in Phase One and Two align with Governor Abbott's data center directive, and the project is designed to move forward unimpeded by ERCOT batch zero delays. Can you just clarify that and help us understand kind of why that is and the strategic value of TCDC's power strategy?
Ted Warner (President and CFO)
Yeah, plain and simple, that directive was aimed at new parasitic load being requested from the grid, which in the state of Texas is referred to as the batch zero process. And so we are not exposed to the batch zero process. Ours is either existing power that's in a PUN or new power that we are building. And so therefore it... it doesn't... it's just not exposed to the batch zero process whatsoever. And you know, the reason why they're doing these audits, etcetera, is to kind of untangle that process and ensure that the data centers that are being built, especially if they're requesting parasitic load that would otherwise go to everyday Texans, is being used responsibly. And you know, again, it's... yeah, this has been built into the plan, built into the DNA—something that we've been planning on since the onset of this.
So that is why. Okay, the other half of that, Mike, is water, right? I mean, water is the other concern there. And what we've done here is we've built and permitted this data center site in the heart of the Permian Basin, where we have ample opportunity to, as Evan said earlier in his remarks, to keep produced water there in the basin—not injecting it downhole—and using it to have a data center that really doesn't add to any water needs from the basin.
Mike Grundall, Analyst at Northland
Got it. Okay. Hey, thanks guys. Thank you.
OPERATOR
Thank you. One moment for our next question. Our next question comes in line of Nick Giles of Beelight Securities. Your line is now open.
Nick Giles, Analyst at Beelight Securities
Yeah, thanks, operator. Hey, good afternoon, guys. You know, I think Mike asked the right questions there initially, but just wanted to clarify: from what you know today, should we still think about initial timing at phase one in the fourth quarter ’27 timeframe?
Ted Warner (President and CFO)
Yeah, that's definitely still what we're shooting for. I mean, I don't know—the rest of the team, you care to comment on there—but that's part of the value here: the power will be available. And now that we have permits in hand, we think if everyone is rowing the boat in the right direction together, that's definitely still achievable to get that phase one in and have it be 2027 power. That's everybody's goal.
Nick Giles, Analyst at Beelight Securities
Understood. That's helpful. And go ahead, Charlie.
Charlie Nelson, Chairman and CEO
No, no, I agree with that. Yep.
Nick Giles, Analyst at Beelight Securities
Great. Okay. Maybe just back on phase one: given that you have some of those permits in hand, it sounds like some dirt can be moved in the near term. Are there any long lead‑time items you might need to make deposits on, or any sense for how much capital you'd be willing to spend on pre‑lease development?
Ted Warner (President and CFO)
In terms of the quantum of capital for pre‑lease development, I mean, obviously we've been spending dollars on pre‑lease development—preparing the site, doing pipeline removal, remediation on the sites. And so in terms of the quantum of capital that we'd be willing to spend, I don't think we have a firm dollar figure where we limit it to. I mean, we're going to be responsible with our TopCo cash. That's our primary mode of responsibility there. But to the extent that there are items that come up that can significantly reduce time to delivery to RFS, we will do that. But again, it's very subjective when we make those decisions. For the most part, just how this development is going to roll out, there is an upper bound, just naturally, in what you do before you go full final investment decision on the asset. I think the fact that we're working with Stream, with their connections and what they actually have on hand—the Thunderhead partnership—that we have the long lead‑time items they have already procured, that makes it a whole lot easier.
We don't foresee any major capex items on our front prior to a lease related to long lead‑time stuff. It's more about making sure that the site gets ready and moving in the right direction to meet the timeline.
Nick Giles, Analyst at Beelight Securities
Got it. Thanks for that. Maybe one more, if I could: given that the potential, or the commercial nature, of phase one has expanded, can you speak to what design options from a data center perspective are on the table? Are you mostly considering ground‑up type builds, or would you explore modular options? What are you comfortable with?
Jose Rodriguez, Chief Operating Officer
Yes, thank you for that question, Nick. So for the first phase, working with our partners, we're looking at a stick‑build approach initially. However, we're also considering modular data center options that we're working with different suppliers to deploy that offer a pretty aggressive RFS timeline, better than stick‑build. So we are not closing any options, and we'll do whatever gets us closer to capacity delivery on the site.
Nick Giles, Analyst at Beelight Securities
Got it. Okay, that's helpful. Well, guys, nice work on the progress. I'll turn it over, but thanks for the update.
OPERATOR
Thank you. One moment for our next question. Our next question comes from the line of Derek Whitfield of Texas Capital. Your line is now open.
Derek Whitfield, Analyst at Texas Capital
Good afternoon all, and congrats on the team that you've assembled.
Charlie Nelson, Chairman and CEO
Thank you.
Derek Whitfield, Analyst at Texas Capital
I wanted to start with the bigger picture at TCDC. As highlighted by Governor Abbott's press release today, you guys are the model citizen for Bring Your Own Generation. Thinking beyond his endorsement, I wanted to ask more broadly your views on how this may play out for competing projects that are subject to batch zero and data center reviews, and what it likely means for the level of competition you'd expect for capacity at TCDC.
Charlie Nelson, Chairman and CEO
I'd say, just right off the bat, there is a high level of uncertainty—both in terms of are people going to get power, the recipients of that are still up in the air for batch zero, and then furthermore what the timing of that is. The process has taken some turns and had some adjustments. I would say, just in terms of the competitiveness, one thing is definitively clear: we have a very firm grasp on what we have. And so everything just comes down to timing of resources for end users and tenants.
And if that's uncertain, it definitely throws some questions around other sites. So, yeah, in terms of the competitiveness, those that get batch‑zero power—there's going to be an absolute green light on those. But for us, we're feeling pretty confident in our position right now because of this.
Derek Whitfield, Analyst at Texas Capital
Great. And as my follow‑up, I wanted to focus on the opportunity beyond TCDC. We've heard from several in industry that lease rates haven't materially increased over the last six months. With the benefit of your entire team being in place, could you speak to where you'd like to take the business beyond TCDC?
Charlie Nelson, Chairman and CEO
Yeah, I think we've spoken pretty openly about this. But really, we see two main opportunities, and we've assembled a team to tackle them accordingly. As you've heard with the team introductions and what we've brought on, we're building a team for growth. This isn't just to build TCDC; this is to build beyond. And so the two opportunity sets really lie in inference and then rinse‑and‑repeat on these large‑scale sites. And what do I mean by inference?
I mean that's 100 megawatt and below—opportunistically a little bit bigger than that—and those are kind of rinse‑and‑repeat modular sites. And then on the larger‑scale stuff, obviously those are greenfield developments, kind of like what TCDC is. We like the blueprint that we've established here with TCDC. And so the plan going forward is to rinse and repeat those. And that's why we've built the team to do just that. We view the market for inference to be a very strong one, though.
Derek Whitfield, Analyst at Texas Capital
Terrific. And maybe just one last, if I could: in your decision to expand phase two capacity, could you speak to what led to that decision to go from 450 to 550? And how should we think about expansion potential beyond phase two based on this revised generation equipment, if you guys choose to use that for phase three?
Jose Rodriguez, Chief Operating Officer
Yeah, I mean it really just came down to what we're able to get under a standard air permit with the equipment packages. And so it really just came down to what we can permit, because above that we go to a PSD permit, which is typically an 18‑month cycle. But those have been delivered quicker now in recent months. Standard air permit is a very straightforward process. And so, yeah, it really just came down to some revisions on our ability to put a little bit more under a standard air permit.
Derek Whitfield, Analyst at Texas Capital
Perfect. Great updates, and again congrats on the team that you guys have assembled.
Charlie Nelson, Chairman and CEO
Thank you.
OPERATOR
Thank you. One moment for our next question. Our next question comes from the line of Nick Giles of Beelight Securities. Your line is now open.
Nick Giles, Analyst at Beelight Securities
Hey, thanks for taking my follow‑up. I think earlier you mentioned there's one more surface waiver pending, and I was hoping you could give us a sense for what timing could look like there and ultimately what having that surface waiver does for the site.
Ted Warner (President and CFO)
Sorry, you cut out there for a second. Could you repeat the question?
Charlie Nelson, Chairman and CEO
He was asking about— I think in the PR on Friday—that we have one more signature on the surface lease waiver side, only one remaining, and what we thought timing was for that.
Ted Warner (President and CFO)
That should be pretty soon. Everyone's pretty much agreed in principle on it, so it should be relatively soon. Verbal sign‑off on that is great. You know, we don't really dive into how unique—and unique in a good way—our situation is compared to a lot of people trying to develop data centers in the heart of the Permian Basin. You need to find a site where you don't expect to have any pads or roads drilled, you're in the right part of the section, and you need to be on top of—even if you own the land—if you're sitting on top of minerals that haven't been developed yet, you need to make sure those mineral owners are going to be able to have access to those minerals, regardless of if you own the land on top of them or not. Fortunately for us, we've got two operators that have leased this acreage, and they've all but drilled up and wine‑racked basically all the productive formations, outside of a couple more permits—I think two or three, I can't remember the exact number—but those pads are going to be nowhere near our site. They can get drilled, and we've got 40‑plus years' worth of production out of those wells.
So it makes it really easy for us to get insurance related to that. Whereas a lot of people have come into West Texas on sites that really don't have a ton of development on them yet, or they're in a part of the section where a bunch of pads and roads need to be put in for the mineral owners to get their minerals, and that has derailed a lot of projects in the heart of the Permian Basin. But again, we feel really fortunate with this site for many reasons, and that's one of them.
So just one more signature remaining from an operator and we're good to go.
Nick Giles, Analyst at Beelight Securities
Great. Thanks for that background, Ted. And then one more that just came to mind, if I can: when we think about exploring other, smaller‑scale data center projects, just to clarify, would these be New Era Energy & Digital independent opportunities, or would this be something that Stream might be interested in pursuing as well?
Charlie Nelson, Chairman and CEO
Look, we think of them as New Era Energy & Digital opportunities. Obviously, Stream has been a wonderful partner here at TCDC, and to the extent that we can work together in the future where it makes sense, I mean, why not? But our team is built for everything from development all the way through execution and operations at this point in time. And so the idea being that carving our own path forward on future sites is the likely outcome.
Nick Giles, Analyst at Beelight Securities
Got it. Okay. Thanks again, guys.
OPERATOR
Thank you again. As a reminder, to ask a question, you'll need to press Star 11 on your telephone. And I'm showing no further questions at this time. I'll now turn it back to Charlie Nelson for closing remarks.
Charlie Nelson, Chairman and CEO
All right, well, first off, you know, thanks, everyone, for the questions, and thank you for making time on the, you know, this afternoon. I'm going to close where I started on this. You know, our focus this quarter was on the parts of TCDC that sit with us and de-risking. And that's all this is. This is just a giant function of de-risking. And the construction permits are now in hand. The land is obviously secured. The team, the fantastic team, is built.
You know, on the commercial side, you know, we're working hard, you know, across the tenant negotiations and with the Stream JV, with the phase 1 PPA. And look, we appreciate your support, and the team is always available here if you need to follow up. And again, thank you for your time, and appreciate you.
OPERATOR
Thank you for your participation in today's conference. This concludes the program. You may now disconnect.
Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company's SEC filings and official press releases. Corporate participants' and analysts' statements reflect their views as of the date of this call and are subject to change without notice.
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