"Oil and gas companies don't like to flare their gas - that's money that's burning away," said Degenfelder, which works with miners connected to EZ Blockchain, a Chicago-based energy and technology company, to cut flaring at some of its 600 oil wells across the Rocky Mountains. Sometimes they give the gas away for free to cryptocurrency miners other times they sell it. Oil companies face pressure from investors and government officials to reduce emissions that lead to global warming. "The sweet spot for us is stranded, low volumes of gas that don't justify a pipeline," said Steve Degenfelder, land manager at Wyoming-based producer Kirkwood Oil and Gas LLC, which has formed an alliance with Bitcoin miners. That typically forces them to burn it off in a process called flaring - creating carbon dioxide emissions - or to vent it into the atmosphere directly as methane. Oil and natural gas come from the same wells, but at these sites, drillers are seeking crude oil and have no pipelines to get the gas to market. The miners are increasingly sending these rigs out to oil fields because it’s one of the cheapest ways to obtain the energy they need. Placed in mobile trailers, these supercomputers run as hot as 160 degrees Fahrenheit (71 degrees Celsius), and in the cold of western North Dakota, people stay warm just by sitting near them, cryptocurrency miners say. Supercomputers must run constantly in a race against other “miners” to solve complex math problems in order to unlock digital vaults holding the currency. Extracting the currency from cyberspace, however, requires vast amounts of often-expensive electricity. They are using stray natural gas unwanted by oil companies to power their search for another treasure: cryptocurrencies like Bitcoin.Ĭryptocurrencies are virtual coins exchanged without middlemen, such as central banks, to purchase goods and services. The trailers - carrying pipes, generators and computers - are called “mining rigs.” But their owners aren’t there to drill for oil. oil patches stretching along the Rockies and Great Plains, trailers hitched to trucks back up toward well pads to capture natural gas and convert it on the spot into electricity.
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