Two recent graduates from Texas A&M University, Brent Whitehead and Matt Lohstroh have made $4 million before their 24th birthdays by using flare gas from Texas oil fields to mine bitcoin. They were sophomores when they decided to get into the business of mining bitcoin in the oil field of East Texas. It was 2019, and at that time, the concept of oil and gas companies joining forces with bitcoin miners was considered a major taboo.
Brent Whitehead and Matt Lohstroh co-founded Giga Energy Solutions, a firm that uses the stranded natural gas that is burned off in oil fields to boost large computers used to mine cryptocurrency.
Whitehead told CNBC, “Growing up, I always saw flares, just being in the oil and gas industry. I knew how wasteful it was.” Moreover, he said, “It’s a new way to not only lower emissions but to monetize gas.”
Oil drillers frequently find natural gas. They are compelled to burn it off as the discovery location is often too far from pipelines that are required to transmit gas. Giga Energy Solutions transports containers having bitcoin-mining computers to the oil wells. The natural gas in excessive amounts, that would be burned off, is diverted to generators that generate electricity to power the mining computers. According to the researchers, this process reduces carbon dioxide emissions by about 63%, according to research from Denver-based Crusoe Energy Systems.
Whitehead told CNBC that they have signed deals with more than 20 oil and gas companies, four of which are publicly traded. Lohstroh and Whitehead are part of a growing movement of people placing big bets on the potential for bitcoin mining to transform the economics of the energy industry.
“They are making their clients revenue through stranded energy bitcoin mining and solving the environmental challenge with flared gas at the same time,” said Lee Bratcher, president of the Texas Blockchain Council.
Giga took off thanks to Whitehead’s background in engineering as well as Lohstroh’s belief in the future of cryptocurrency.
“No one controls it, and you don’t have to ask permission to use it,” said Lohstroh.
“That’s really what drew me to bitcoin.”
