Oil giant ExxonMobil (XOM) is running a pilot project to use what would otherwise be wasted gas from its North Dakota oil wells to power bitcoin mining operations, Bloomberg reported Thursday, citing people familiar with the matter.
The excess natural gas would have otherwise been burned off, or flared, because of the lack of pipelines.
The oil company is also looking to supply flared gas to bitcoin miners at other sites around the globe, according to the report.
ExxonMobil has a deal with Crusoe Energy Systems, one of the pioneers of using wasted gas to power bitcoin mining operations, to take gas from an oil well pad in the Bakken shale basin to power mobile generators that are used for bitcoin mining operations, Bloomberg said, citing the unnamed source.
The news comes after another major oil company, ConocoPhillips (COP), said it's running its own pilot project to route excess natural gas from one of its Bakken region projects in North Dakota to supply necessary power for a bitcoin (BTC) mining operation.
“ExxonMobil continuously evaluates emerging technologies aimed at reducing flaring volumes across our operations,” ExxonMobil spokeswoman Sarah Nordin told CoinDesk in an email, adding that the company recently announced that its emissions reduction plans are expected to achieve World Bank Zero Routine Flaring by 2030.
Most recently, Crusoe Energy was recognized for its “innovative” solution to flaring globally by the World Bank’s Global Gas Flaring Reduction Initiative report. In the flaring process, excess natural gas is burned off into the atmosphere as part of oil drilling operations; it has become standard industry practice because of the lack of transportation infrastructure.
Nordin declined to comment on “rumors and speculations” about ExxonMobil’s pilot project, and Crusoe Energy also declined to comment on Bloomberg’s story.
Shares of ExxonMobil were flat on Thursday.
In 2019, ExxonMobil and ConocoPhillips were among the founding members of the OOC Oil & Gas Blockchain Consortium, a group of energy companies looking to establish “key blockchain standards, frameworks and capabilities” within the industry. Other members of the group include Chevron, Equinor (EQNR), Hess (HES), Pioneer Natural Resources (PXD) and Repsol.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.