Williams Cos. (WMB), which capitalized on booming power demand in the first quarter,  signaled on May 6 that it intends to continue its strategy as the energy from its pilot Socrates project in Ohio has been fully contracted.

Socrates is a two-site, gas-fired power generating project near Columbus, Ohio, near several WMB natural gas pipeline networks. The complex will produce electricity for behind-the-meter power for customers, most likely tech companies.

“We have fully contracted this project that will deliver speed to market solutions for the growing data center demand in Ohio,” Williams Cos. CEO Alan Armstrong said during the company’s earnings call on May 6.

The project’s customers have not been named. The north site of Socrates is less than a mile away from a campus where Intel is developing a $28 billion chip-manufacturing facility.

East Daley Analytics noted in March that the area is set to add about 2.2 gigawatts in new demand. Data center developers AWS, Google and Vantage have planned projects in the region.

“If WMB sources the gas from its own G&P footprint, it can optimize the full value chain by gathering, transporting and converting gas to electricity, earning a rate at each stage,” EDA Analyst Zach Krause said in the report. “This strategy would increase in-basin consumption and would allow Northeast gas production to grow relative to our current expectations.”

Williams will invest about $1.6 billion in Socrates. The contracts are backed by a 10-year fixed-price supply agreement with an option for a five-year extension.

The project will produce a total of 400 megawatts of power. Construction is set to begin at both sites over the next four months, with electricity available by third-quarter 2026.

Armstrong said the project should produce income at 5X EBITDA. During the call, executives said the risk involved in building Socrates is low, thanks to the credit rating of the tech customers.

“This is some of the best credit out there from a customer opportunity perspective,” said John Porter, Williams’ CFO. “The customer has been with us in lockstep, making sure that we can go out and invest in these projects in a bit of a new arena, albeit playing to our core strengths and capabilities, and things we’ve done before.”

Armstrong said Williams will continue to use the same model setup as with Socrates and has two similar projects that have progressed far enough to start ordering equipment.

Financial look

Financially, Williams reported a strong enough quarter to raise its 2025 EBITDA guidance by $50 million to $7.5 billion-$7.9 billion. The company beat street expectations over the start of the year, according to an analysis by TPH Analyst Zack Van Everen.

Williams reported adjusted EBITDA of $1.989 billion compared to an expected $1.948 billion.

“We are calling this positive as the company continues to add demand-driven projects,” Van Everen said in his report.

Armstrong discusses change

Williams announced the day before the earnings call that Armstrong would leave his post as CEO in July and take the position as executive chairman on the company’s board. He’ll be replaced by Chad Zamarin, Williams’ executive vice president of corporate strategic development.

Armstrong said it was the right time to move, crediting the company’s strength and personnel.

“It’s such a great time,” he said. “I’m very excited about the talent in both Chad and the team that’s coming up in the organization, so I think the mix is just right.”

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