While the Shale Boom has had a good impact for the most part in Texas by providing tons of jobs and lessening the United States dependence on Middle East oil the environmental issues caused cannot be ignored. One of those environmental issues has been routine flaring of natural gas. While a much cleaner energy source than coal or oil natural gas still produces a ton of CO2 and can sometimes also produce methane. The Permian Basin (located mostly in West Texas but does extend into New Mexico) produces so much natural gas that it is too costly to capture and move it and instead is regularly burned off. Routine flaring is what occurs when the plants are under normal operation and are not when the plant runs into an issue and needs to burn off natural gas. It has only been within the last year that this practice has come under increased scrutiny as Texas has looser regulations and issues permits for a lot longer than most states. Coupled with the sheer production volume of the basin it has become a very large issue. This last week both BP and Royal Dutch Shell have both written letters to the Texas Railroad Commission to have the regulations strengthened as even these producers of natural gas want something other than burning it off done with the energy source.
A Possible Solution
When I first read about this article as it popped up on my Robinhood feed I first thought of Layer1 as a solution as they have shown great promise with using renewables and their bitcoin miners becoming batteries. However, I quickly realized that with a constant stream of natural gas that has to be used or the issue would not be resolved that kind of destroys the idea of Layer1 as they highlight their miners being batteries too. When I decided to look further into if anyone was looking into possibly using this abundant resource I was able to find one company just doing that.
EZ Blockchain is a Chicago based company that has deployed its generator server combos to several different locations the most important being the Bakken Shale location in Montana and North Dakota. While I am sure this formation produces quite a bit of natural gas itself the Permian has led the shale boom in the United States. According to the latest information I could find in 2018 alone 238.1 billion square feet of natural gas was flared worth approximately $750 million. This would be a fantastic way to use this resource.
While liquefying the natural gas to create LNG would also be a great idea due to the clean nature of burning it. Though the process to make it (facilities needed) and safely transport it (pipelines) to the coast for shipping makes this idea much less economical. Pipelines would have to be laid and the process for doing that is both long timewise and expensive before we would even take environmental factors into play for that.
While it may not be EZ Blockchain that leads the way in using excess natural gas to power crypto mining it is easy to see how some mining players could easily benefit from this. If Texas makes it harder to routinely flare off gas than these companies that offer to use it would have immense leverage to get the gas at dirt cheap prices while also being able to practically be on location to use it. This could future help promote America gaining more hash power in the crypto space while also looking good by taking care of and utilizing a byproduct that is currently being wasted. Overall someone who requires vast amounts of energy will end up taking this currently wasted stuff. It would only make sense for crypto to use it since it is so so energy intense. It would allow older miners to even continue to mine because energy consumption would not be a problem. The only other thing I could think of would be some company with a supercomputer moving in and wanting both isolation and cheap and abundant energy like the Permian Basin has to offer.