A Canadian oil mining firm has added an extra activity that will enable it to produce more oil by taking care of the residue gasses – mining Bitcoin as a by-product.
The two activities have extremely huge differences with the only meeting point being that both of them involve mining. But a Canadian oil mining company, Black Pearl Resources, has found a unique blend between the two mining activities on site.
Since oil mining activities involve emission of natural gas, the oil firm is using the gasses for mining Bitcoin as a by-product. This is done by directing the natural gasses to drive a Bitcoin mining rig. The process involves an electricity generator that is power by the natural gasses producing enough electricity which is used to mine Bitcoin as a by-product. The rig is of a considerable size since even with the low Bitcoin prices, it mines enough Bitcoin that is enough to cater for the firm’s operational costs.
The idea of mining Bitcoin as a by-product was presented by Stephen Barbour, a consultant who seeks ways of making oil companies rake in more profits by minimizing their operational costs. Barbour acknowledged that the idea was a result of studying available information on Bitcoin mining and the profitability margins presented.
The consultant told WSJ:
I knew about all the wasted energy that goes on. Reading about Bitcoin mining and how it could monetize energy through the internet. I just thought that was unbelievable.
Although Bitcoin is mined as a by-product, it benefits the company more than offsetting its operational costs; it helps the firm to produce more barrels of oil.
According to the firm’s production foreman, Ryan Wartman:
It was the best option for us… We’re using it to bring ourselves below the government-regulated amount that we can vent on location and keep producing oil. [We] are able to keep the oil well operating 24 hours per day by directing the natural gas output into the crypto mining rigs.
With such revelations, is mining Bitcoin as a by-product something other oil mining companies are likely to explore?
You may also be interested in:
- Bitcoin tracking helps rescue a kidnapped IT professor, police and an exchanger among suspects arrested
- Gold mining vs Bitcoin mining: Gold mining is 23 times more costly