Exxon Mobil Corporation, the biggest U.S.-based oil and gas company, is contemplating extending its North Dakota bitcoin mining pilot program to cut down the natural gas amount burned off or vented into the environment, Bloomberg reported Thursday.
The news outlet reported that the oil giant has an arrangement with Crusoe Energy Systems Inc. to reroute gas from an oil well pad to mobile generators running Bitcoin mining servers.
The experimental project kicked off in January 2021 in North Dakota’s Bakken region and was extended in July; it currently uses up to 18 million cubic feet of gas per month that Exxon cannot monetise.
One of the people familiar with the matter told Bloomberg that Exxon is now contemplating similar pilot projects in Alaska, Nigeria’s Qua Iboe Terminal, Argentina’s Vaca Muerta shale field, Guyana, and Germany.
According to ExxonMobil’s spokesperson Sarah Nordin, the company always strives to adopt the new technology to reduce flaring volumes across its operations. However, she declined to answer about “rumours and suspicions about the pilot project.”
Bitcoin mining allows oil producers to sell gas accidentally discovered as they drill for oil, thereby increasing revenues to these firms and benefiting the environment. Such energy is often lost due to the lack of nearby pipelines.
Crusoe, located in Denver, assists these businesses in capturing otherwise lost extra gas from energy production, converting it to electricity, and using it to run data centres and bitcoin mining operations. According to this corporation, bitcoin mining is estimated to cut down on carbon dioxide-equivalent emissions by more than 60% compared to conventional flaring.
A power supply unit at a mining farm. Photo: Bloomberg
Danielle Fugere, president of the shareholder-activist organisation As You Sow, told Bloomberg that these pilots are an innovative move for Exxon to discover a way to utilise its surplus gas. It is repurposing something that would otherwise go to waste, she said.
Last month, the Alaska-based oil and gas giant ConocoPhillips launched similar operations in Bakken, North Dakota, to sell surplus natural gas to a third-party bitcoin mining farm.
According to the Earth Resources Observation and Science (EROS) Centre, the Bakken contains one of the largest oil and natural gas deposits in the U.S. It led to the “Bakken oil boom” that elevated North Dakota to second place in oil production, behind only Texas.