Russia's Gazpromneft and U.S.-sanctioned bitcoin (BTC) mining hosting firm BitRiver plan to develop crypto mining facilities at oil fields, according to memorandum signed at the St. Petersburg International Economic Forum on Thursday.
Gazpromneft will provide energy to data centers set up by BitRiver, according to a statement sent to CoinDesk. These will either be at new oil fields where transportation infrastructure has not been set up, or remote sites where the transport is too expensive, the statement said.
Flared-gas mining has garnered increasing popularity over the past year or so as it enables oil producers to take advantage of what otherwise would be wasted methane gas. ExxonMobil (XOM) is reportedly looking into this for some of its oil fields, and Middle East oil producers Abu Dhabi and Oman have taken stakes in Crusoe Energy, one of the pioneers in using flared gas as a power source.
On April 20, BitRiver was added to the U.S. Treasury Department's Office of Foreign Asset Control (OFAC) list of specially designated nationals, because the company helps Russia "monetize its natural resources." The company has called the measures unfair and anti-competitive and has announced plans to sue the U.S. government.
"Over the next two years, BitRiver intends to implement projects to create its own data centers for power-intensive computing with power scaling up to 2 [gigawatts], including [associated petroleum gas], which will additionally provide high and stable power consumption," Igor Runets, founder and CEO of BitRiver, said in Thursday's statement.
BitRiver is one of the largest mining firms in Russia, with its local subsidiary managing over 300 megawatts of data centers.
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.