BKV Corporation (NYSE: BKV) announced a significant equipment supply contract Wednesday, driving the stock price higher. The company disclosed that a wholly owned subsidiary has signed an agreement with a Tier 1 supplier to provide natural gas-fired power generation equipment.
The contract covers approximately 1,200 megawatts of capacity for a proposed project in Texas. The agreement includes two turbines, balance-of-plant equipment, and related services. Deliveries are scheduled to begin in September 2028. The total value of the contract is nearly $800 million, which includes $80 million in reservation fees already paid by BKV. The remaining payments are scheduled between October 2026 and December 2028.
To support the project, BKV executed a backstop agreement with a leading investment-grade hyperscaler. This entity is also the intended off-taker for the power generation project. Under this agreement, the hyperscaler will reimburse nearly 90% of BKV’s payments due through March 31, 2027. The contract includes a provision allowing BKV to terminate the supply agreement without further payment obligations if the company and the hyperscaler fail to reach mutually agreeable offtake arrangements by March 31, 2027.
BKV Chief Executive Officer Chris Kalnin noted that the structure highlights the company’s disciplined approach to capital deployment. The article highlights that data centers are becoming a major source of electricity demand due to AI workloads. Hyperscalers are responding by investing directly in power generation and signing long-term electricity agreements. The text notes that Google signed a 20-year agreement with Constellation Energy covering 3.59 gigawatts of electricity, while Amazon signed a similar 20-year agreement with Constellation to secure nuclear power.
At the time of publication, BKV shares were trading at $23.64, up 7.23%.
