About $18 billion in loans tied to an Oracle-leased data center in New Mexico has come under pressure, with loans quoted at 89 to 91 cents on the dollar by syndicate banks including Santander and Jefferies , the Financial Times reported on Friday.

The development comes amid concerns that growing local opposition to the project over fears it would impact water supply and air quality could derail Oracle's massive AI infrastructure build-out, the FT report said.

The 1,400-acre "Project Jupiter" campus in Dona Ana County is part of Oracle's broader agreement with OpenAI to provide AI computing capacity.

The project secured $18 billion in loans from a consortium of banks late last year to kick-start construction, according to media reports.

Efforts to sell the debt to a broader pool of investors have stalled amid concerns over Oracle's rising borrowing and weakening creditworthiness, the Financial Times said.

Oracle, Santander and Jefferies did not respond to Reuters requests for comment.

Oracle's corporate credit rating sits one notch above junk following a downgrade from S&P in July. Banks were now forced to hold more Oracle-linked project debt on their balance sheets than initially planed, the Financial Times said.

Oracle has been ramping up spending to finance its expansion into AI infrastructure, while its rising debt load has drawn increasing investor scrutiny.

Project Jupiter was initially set to be powered by 2.2 gigawatts of gas turbines, but the state land office blocked a request to run a natural gas pipeline to the data center, the report said.