US oil and gas corporation Black Rock Petroleum Company has signed a binding agreement with Optimum Mining Host Limited Liability Co. to host and operate up to one million bitcoin miners.
According to a press release, the equipment being moved from China is being imported to Canada for deployment at three sites in Alberta's natural gas mining district.
The first batch of 200,000 miners will be deployed by Black Rock at its recently acquired Quirk Creek gas processing plant, operated by Caledonian Midstream Corporation.
The contract has been signed for 24 months with an option to extend for 12 months with advance notice. Black Rock has committed to provide hosting, maintenance, repairs, security for the equipment and electricity supply at $0.02 per kWh for an agreed fee.
The initial commitment under the contract is to deploy 200,000 units plus 300,000 units in the near term. To do this, Black Rock will deploy a second site in Alberta. The company will determine the location for another 500,000 miners at a later date.
Black Rock CEO Zoltan Nagy said gas demand is growing across North America and Quirk Creek is well suited to serve the Alberta market. The company estimates the field, where the plant is located, has gas reserves of 1.4 billion cubic metres.
"Current production levels are good and our engineers have reviewed production records and analysed recent reserve estimates and we are confident that we have the expertise, technology and resources to significantly increase production and, in turn, the cash flow of the plant and locate and operate bitcoin miners at an energy price of about three Canadian cents per kWh," Nagy said.
He said with the agreement with Optimum Mining, the corporation is entering the bitcoin mining and hosting market in Canada and joins publicly traded industry companies such as Riot Blockchain, Marathon Digita, Argo Blockchain and Genesis Digital Assets as a competitor.
Recall that the head of Dubai-based investment firm IBC Group, Khurram Shroff, previously described the relocation of mining capacity from China due to a crackdown by the authorities as "a huge opportunity for Canada".
MicroStrategy CEO Michael Saylor also opined that industry representatives in North America would gain additional revenue as a result of the shift in bitcoin mining capacity from the Middle Kingdom.
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