Yacimientos Petrolíferos Fiscales (YPF) will supply natural gas to cryptocurrency mining companies. YPF's supply will be 1 MW.

Argentina's state-owned energy company Yacimientos Petrolíferos Fiscales (YPF) Luz has begun a pilot project to make natural gas residual from oil exploration, which would be lost, to be used in cryptocurrency mining. The operation is reportedly taking place in the Vaca Muerta region, an essential oil and natural gas production center in Argentina. A Fiscal Petroleum Deposits operates in the region extracting commodities.

Residual natural gas supply for Cryptocurrency mining will be 1 MW

The purpose of the project is to redirect part of the residual natural gas from the oil extraction process of Yacimientos Petrolíferos Fiscales, also called flare gas, for a mining company cryptocurrencies from the same region, allowing its operation using low-cost energy. 

According to information, the supply of Yacimientos Petrolíferos Fiscales will be 1 MW and the cryptocurrency miner is operated by an international client of YPF.

The project has been in development for about 3 months. According to the CEO of Yacimientos Petrolíferos Fiscales Luz, Martín Mandarano, the objective is to expand supply to around 8 MW by the end of the year.

Payment for the supply of natural gas may follow a blockchain price linked to the activity

According to Mandarano, the company started to develop this generation pilot for cryptocurrency mining with a focus on sustainability and business from residual natural gas, which cannot be used at the time of exploration and at the beginning of production in an oil field.

Natural gas is a less polluting source compared to mineral coal and oil, and the use by a mining company avoids the environmental impacts linked to it during the oil extraction process. Under the project, cryptocurrency miners will pay Yacimientos Petrolíferos Fiscales for the supply, and this payment can be made following a fixed price or following a blockchain price linked to the activity.

Natural gas and nuclear energy gain space in the cryptocurrency mining segment

Yacimientos Petrolíferos Fiscales did not specify which cryptocurrencies will be mined. According to a study by the University of Cambridge released in September, still in 2021, natural gas and nuclear energy gained space as a source of energy linked to the bitcoin mining process.

Coal remains the main source, with 36,6% of the total, while hydroelectric power reaches 14,9%. Natural gas, on the other hand, increased from 12,8% in 2020 to 23% in 2021, while nuclear energy rose from 4% to 8,9¨.