(Bloomberg) — Exxon Mobil Corp. has a pilot program that uses excess natural gas that would otherwise evaporate from oil wells in North Dakota to boost cryptocurrency mining operations. He now plans to do the same in other locations around the world, according to people familiar with the matter.
The oil giant has an agreement with Crusoe Energy Systems Inc. to take gas from an oil well in the Bakken shale basin to power mobile generators used to run bitcoin mining servers, people said. The pilot project, which launched in January 2021 and expanded in July, uses up to 18 million cubic feet of gas per month that would otherwise have evaporated or burned because there are not enough pipelines.
Exxon, the largest oil producer in the United States, is considering similar pilots for Alaska, the Qua Iboe terminal in Nigeria, Vaca Muerta in Argentina, and Guyana and Germany, one of the people said.
“We are continually evaluating emerging technologies aimed at reducing burn volumes in our operations,” and Exxon hopes to deliver on the World Bank's call to end routine burning by 2030, spokeswoman Sarah Nordin said in an email. He declined to comment on “rumors and speculations about the pilot project.”
Crusoe declined to comment.
Oil and gas producers are under increasing pressure from regulators and investors to reduce their carbon footprint and help combat climate change. That includes reducing the amount of gas they burn. At the same time, there is a flood of miners trying to use cheap gas in oil-producing fields to boost their operations. The gas is still burning, releasing carbon dioxide into the atmosphere, but energy is used instead of simply being wasted.
Last month, ConocoPhillips said it has been supplying gas from Bakken in North Dakota to a bitcoin mining company for the first time.
Shale oil produces so much excess gas that it ends up being expelled into the air or burned. Natural gas is mainly made up of methane, a global warming agent that is more than 80 times more powerful than carbon dioxide during its first two decades in the atmosphere. North Dakota, Colorado and Wyoming are among the first places to use crypto mining to reduce methane emissions.
The push for cryptocurrency miners in North Dakota's oilfields would only be beginning, said Craig Thorstenson, manager of the permitting program for the state's Air Quality Division. He estimated that about 90% of the gas produced in the state reaches the pipelines for use in power plants and elsewhere. The rest is wasted.
Danielle Fugere, president of As You Sow, an environmental group of shareholders and activists, said it is a positive step for Exxon to find a use for gas that would otherwise be wasted and burned in the atmosphere.
But it would be better if the company worked more aggressively to move away from fossil fuels, Fugere said.
Original Note:
Exxon Considers Taking Gas-to-Bitcoin Pilot to Four Countries
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