Troubled by dwindling natural gas prices, one producer from Alberta has come up with a rather innovative solution to improve the company’s bottom line. Iron Bridge Resources (IBR), one of Canada’s largest oil and gas companies, has announced that instead of selling natural gas at stubbornly low prices, it will utilize a part of its production to generate electricity and use the same to operate a bitcoin mining facility.
To implement this new strategy, IBR is launching a subsidiary, dubbed Iron Chain Technologies, (ICT) that will be tasked with overseeing the new wholly-owned cryptocurrency mining and hosting facility.
In a press release, IBR stated that the forthcoming mining facility would be located at its oil and gas field sites in Elmworth, Alberta.
IBR’s radically different strategic move as an oil and natural gas company makes sense considering that each unit of bitcoin is currently priced at over $9,000, which dwarfs the natural gas price of $1.98 per cubic feet even if consider the high energy demands of crypto mining farms.
“We are very excited to be joining the blockchain movement, and together with our new technology team, we hope to contribute to the ecosystem by helping to increase transaction speeds and lower transaction costs,” said Iron Bridge Resources CEO, Rob Colcleugh.
“Our IBR shareholders are expected to benefit from increased natural gas netbacks as we convert our clean, low priced gas to electricity and then direct that electricity to profitably mine cryptocurrency and host platforms for third-party mining equipment.”
IBR also confirmed that operations are in full swing with ICT already beginning the mining process with hardware sourced and assembled by its workforce. Three IT systems architects with previous experience of handling mining equipment have been deployed to ensure a smooth start to the new venture. As of now, the company is mining bitcoin only, although it plans on maintaining the flexibility to focus on altcoins if need be.
It is worth noting here that ICT’s pilot crypto mining project will incur a very modest initial cost because of IBR’s rich infrastructure and resource pool. Additionally, the Elmworth hydrocarbon processing facility where the crypto mining operations will take place produces an abundance of electricity. So much so that ICT will be allocated 700 kW of very low-cost energy in the initial phase, which can be increased further on quick notice.
According to the company’s assessments, IBR currently produces enough excess natural gas to power a 45MW crypto farming facility. Meanwhile, the company is also in talks with other natural gas producers to discuss the possibility of future collaborations on commercial projects.