Gazprom, one of the world’s major emitters of carbon dioxide, intends to lessen its carbon impact by supplying its flare gas for Bitcoin mining.
Despite its scepticism over the legalisation of cryptocurrency trade and payments, the Russian government continues to create ties with key actors in the cryptocurrency mining sector.
Gazprom Neft, the state-owned gas company in Russia, has partnered with BitRiver, the biggest crypto-mining colocation services provider in Russia, to provide hosting services for significant crypto mining operations. The firms announced on June 16 that Gazprom would furnish BitRiver’s partner data centres with energy produced from related petroleum gas.
BitRiver will construct a digital infrastructure based on oil fields from which Gazprom will supply crypto mining services using flare gas as part of the agreement.
Vadim Yakovlev, the first deputy CEO of Gazprom, highlighted that the company’s economic strategy does not include cooperation with digital assets. Rather, the gas giant aims to maximise the use of energy resources to facilitate renewable energy by permitting “new methods of productive use of associated petroleum gas,” as he emphasised.
“Reducing our carbon footprint is a fundamental element of Gazprom Neft’s ESG approach. […] By integrating technology and competencies with partners, we develop the finest industrial practices for the effective and eco-friendly use of natural resources.”
Gazprom is both one of the main gas providers to the European Union and one of the largest oil and gas enterprises in Russia. As of 2019, the oil company is allegedly rated as the world’s third-largest emitter of carbon dioxide.
According to the release, flare gas-powered cryptocurrency mining initiatives are particularly applicable while operating in new oil fields that lack an established gas transmission infrastructure. As such resources are connected with excess power and unprofitable flare gas logistics, a second alternative is to establish these developments on isolated oil fields in Siberian areas.
Igor Runets, the founder and chief executive officer of BitRiver, said that the new relationship with Gazprom is part of the company’s ambitious aim to raise its overall power capacity to 2 gigawatts within the next two years.
In October 2021, the Russian government had previously examined a scheme to generate Bitcoin using related petroleum gas.
Russia is a prominent participant in both the global energy and Bitcoin (BTC) mining sectors. As of August 2021, according to the Cambridge Bitcoin Electricity Consumption Index, the nation was the third greatest BTC hash rate generator in the world. According to the most recent index update, Russia’s BTC hash rate dropped to 8.6 EH/s in January 2022 from 13.6 EH/s in August 2021, relegating it to fifth place.