Bitcoin Miner Crusoe Mostly Not Affected by North Dakota Oil Site Explosion

The incident wasn’t caused by Crusoe’s equipment, according to the company, and damages were minimal.

AccessTimeIconApr 11, 2022 at 6:52 p.m. UTC
Updated Apr 11, 2022 at 7:07 p.m. UTC

Aoyon Ashraf is managing editor with more than a decade of experience in covering equity markets

Crusoe Energy, the bitcoin (BTC) miner that uses flared gas that would otherwise be wasted to power its miners, said Monday it was largely unaffected by an accident that occurred last week near one of its bitcoin mines in North Dakota.

Crusoe noted the incident wasn’t connected to its operations. “There was an accident unrelated to us on a location where we operate but we were relatively unaffected,” Crusoe Energy’s CEO and co-founder Chase Lochmiller told CoinDesk.

“Fortunately, nobody was hurt. Our operation was not the cause and was located far enough away from the incident that the damages to Crusoe’s facilities were minimal,” Lochmiller added.

Images of the explosion circulated on Telegram and Twitter on Monday. CoinDesk has confirmed the fire was at an oil well site in North Dakota where Crusoe operated but did not give other details.

Crusoe Energy, which recently was recognized for its “innovative” solution to generating energy by the World Bank’s Global Gas Flaring Reduction Initiative report, has several sites across the U.S., including in North Dakota, Montana, Wyoming and Colorado, where it uses wasted natural gas to power bitcoin mining rigs. Crusoe’s customers include Devon Energy (DVN), Kraken Oil & Gas, Canadian oil firm Enerplus (ERF) and others.

Notably, Crusoe is reportedly working on a pilot project with Exxon (XOM) to use flared gas at Exxon’s North Dakota oil wells to power bitcoin mining operations. And 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 power bitcoin mining.

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. The process is under environmental scrutiny, however, and U.S. President Joe Biden has pledged to cut methane emissions from oil and gas operations.

A plan to reach net-zero emissions by 2050 laid out by the International Energy Agency (IEA) would require all non-emergency flaring to be eliminated globally by 2030.

North Dakota passed a bill last year incentivizing oil and gas companies to stop flaring by providing a tax rebate for using a flare mitigation system that captures a specified percentage of gas at the site.

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Aoyon Ashraf is managing editor with more than a decade of experience in covering equity markets

CoinDesk - Unknown

Aoyon Ashraf is managing editor with more than a decade of experience in covering equity markets