Crusoe Energy states that its bitcoin mining system avoids as much as 2/3 of methane emissions that would occur if the gas were vented or flared.
As a society, we depend on fossil fuels to power and heat our homes, run our vehicles, and manufacture plastic, steel, and various other products. When fossil fuels are burned, they emit greenhouse gases that trap heat in the earth’s atmosphere. This excess heat contributes to climate change. During the process of extraction, the oil and gas industry release many valuable wastes and by-products, including hydrocarbon gases. In order to deal with these wastes, the hydrocarbons (mostly methane) are commonly flared. The flaring of methane causes a reaction that produces carbon dioxide, a greenhouse gas that has a significantly lower warming potential. Companies such as ExxonMobil, Chevron, and Shell have made flaring a standard industry practice.
Some companies are exploring diverting this flared methane to generate electricity for crypto mining, which uses vast energy to create digital assets. These assets are backed through “proof of work,” verifying transactions, and creating new cryptocurrency units.
There are a few potential benefits to this approach. First, using flared methane to generate electricity directly at the oil field reduces the amount of direct methane emissions released into the atmosphere, which is a positive environmental outcome. Additionally, some oil and gas companies may be able to generate additional revenue by selling the electricity they generate to crypto miners. The severe environmental impact of blockchain technologies, particularly cryptocurrency mining, has stirred debate and a move towards “carbon neutral” cryptocurrencies. Flare technology provides a way to leverage waste products. In addition to the electricity generation, the flaring process can utilize the heat, carbon dioxide, and water vapor it produces to run vertical greenhouse farms. Such containerized farms can provide fresh green food, another source of revenue and green appeal. Plants will also serve for carbon dioxide capture and production of CO2 emission quotas.
However, there are also some potential drawbacks to this approach. For one, using flared methane to generate electricity is not carbon neutral compared with zero-emission forms of energy generation, such as solar or wind power. Therefore, flaring is a short-term solution to create the path to net zero. Additionally, the volatile nature of cryptocurrency prices means that relying on revenue from crypto mining may not be a stable or sustainable source of income for oil and gas companies.
While using flared methane to generate electricity for crypto mining may have some potential benefits, it is not a long-term solution to the problem of greenhouse gas emissions from oil and gas operations. Instead, we must focus on transitioning to renewable energy sources to address this issue’s root cause.
Considering the impacts that flaring causes on the environment, it is imperative to quantify the CO2 emissions coming from these operations. By utilizing a remote sensing algorithm, the volume of flared methane gas can be determined. With a known volume, CO2 emissions can be derived. The remotely sensed data provides the facility manager emission measurements in a timely and scientifically sound manner.