CALGARY, Alberta, Jan. 22, 2018 (GLOBE NEWSWIRE) — Iron Bridge Resources Inc. (“Iron Bridge”, “IBR” or the “Company“) (TSX:IBR) is pleased to announce the formation and launch of a wholly-owned cryptocurrency mining and hosting operation called Iron Chain Technology Corp. (“ICT”). ICT will own and operate cryptocurrency mining datacenters at Canadian oil and gas field sites, taking advantage of cheap, clean burning natural gas to generate its own electricity. As a result of this structure and the current Canadian gas price environment, ICT will benefit from some of the lowest cost power in the world.
“We are very excited to be joining the blockchain movement and together with our new technology team, we hope to contribute to the ecosystem by helping to increase transaction speeds and lower transaction costs,” said Iron Bridge Resources CEO, Rob Colcleugh. “Our IBR shareholders are expected to benefit from increased natural gas netbacks as we convert our clean, low priced gas to electricity and then direct that electricity to profitably mine cryptocurrency and host platforms for third-party mining equipment.”
Iron Chain Technology expects to begin operating its pilot cryptocurrency mining facility near IBR’s oil and gas operations at Elmworth, Alberta. ICT is already currently mining with equipment sourced and assembled by technology professionals who have been engaged by the Company. These professionals are IT systems architects who have extensive experience assembling mining equipment and have a history of profitably mining cryptocurrencies. ICT is providing hosting services for a limited amount of equipment from third-parties, and expects this to be a growth area for the Company. The Company is currently mining Bitcoin and intends to maintain flexibility with regard to the type of cryptocurrency coin that gets mined going forward.
While North American natural gas prices have been weak for a number of years, the market in Western Canada has been significantly negatively impacted by strong supplies and persistent pipeline takeaway restrictions. This has lead to AECO prices that trade in the $1.50 per GJ range in the futures market. This pricing environment, combined with the emergence of blockchain and cryptocurrencies as increasingly accepted and enduring technologies, provides an opportunity for ICT to become an important infrastructure player by leveraging its sustainable power cost advantage in a safe, stable developed country.
“I am encouraged by the potential that ICT represents for our Iron Bridge shareholders,” said Chairman Josh Young. “With natural gas pipeline infrastructure constraints representing persistent pricing challenges, I support our management team’s efforts to find all means possible to improve the value received from our production streams.”
ICT’s pilot cryptocurrency mining project will involve a very modest initial capex investment as a result of its ability to leverage existing infrastructure and excess power generation from IBR’s Elmworth hydrocarbon processing battery, fired by IBR’s clean burning natural gas production, to provide power to the mining control center. The pilot project currently has access to approximately 700 kW of very low cost power with the ability to expand that power generation capability rapidly. ICT’s parent company, Iron Bridge Resources, currently produces enough natural gas to power a 45 MW facility and expects to significantly increase that gas production within the next two months when it brings on-stream additional Montney production. ICT is also in discussions with other natural gas producers to work with them on future commercial projects. As a result, ICT is interested in pursuing industrial scale hosting opportunities.
Part of ICT’s strategy involves the sourcing of cryptocurrency mining rigs using processing gear that is not experiencing the high levels of demand that many rig components currently are seeing. Being located in a cold jurisdiction where power is abundantly cheap, ICT is sourcing components that would be challenging to use in typical grid-connected and warmer climates. This is expected to further reduce capital costs and could be a sustainable competitive advantage in hosting.
For more information, please contact:
IRON BRIDGE RESOURCES INC.
(parent company of Iron Chain Technology Corp.)
Chief Executive Officer
Vice President, Finance and Chief Financial Officer
Suite 1200, 500 – 4th Avenue SW
The information in this news release contains certain forward-looking statements. These statements relate to future events or our future performance. All statements other than statements of historical fact may be forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as “seek”, “anticipate”, “budget”, “plan”, “continue”, “estimate”, “approximate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe”, “would” and similar expressions. More particularly and without limitation, this news release contains forward-looking information relating to: the Company’s business plans in respect of ICT and the potential benefits to and impact on the Company including anticipated increases in natural gas netbacks, ICTs plans to own and operate cryptocurrency mining datacenters, commencement of the pilot cryptocurrency mining facility and the timing thereof, anticipated increases in the Company’s gas production which may be used to fuel a facility and the potential for future industrial scale hosting opportunities.
With respect to forward-looking statements contained in this news release, Iron Bridge has made assumptions regarding, but not limited to: conditions in general economic and financial markets; value of cryptocurrencies; cost of generating power and electricity; effects of regulation by governmental agencies; current and future commodity prices and royalty regimes; future exchange rates; timing and amount of capital expenditures; the impact of increasing competition; the price of natural gas; that the Company will have sufficient cash flow, debt or equity sources or other financial resources required to fund its capital and operating expenditures and requirements as needed; that the Company’s conduct and results of operations will be consistent with its expectations; and current or, where applicable, proposed assumed industry conditions, laws and regulations will continue in effect or as anticipated.
These statements involve substantial known and unknown risks and uncertainties, certain of which are beyond the Company’s control, including: the impact of general economic conditions; industry conditions; changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced; fluctuations in cryptocurrency valuations, power electricity costs, commodity prices, foreign exchange and interest rates; stock market volatility and market valuations; volatility in market prices for natural gas; liabilities inherent in oil and natural gas operations; changes in income tax laws or changes in tax laws and incentive programs relating to the oil and gas industry; obtaining required approvals of regulatory authorities; lack of available capacity on natural gas pipelines; the lack of availability of qualified personnel; and ability to access sufficient capital from internal and external sources. Many of these risks and uncertainties and additional risk factors are described in the Company’s Annual Information Form which is available at www.sedar.com.
The Company’s actual results, performance or achievement could differ materially from those expressed in, or implied by, such forward-looking statements and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do, what benefits that the Company will derive from them. The Company’s forward-looking statements are expressly qualified in their entirety by this cautionary statement. Except as required by law, the Company undertakes no obligation to publicly update or revise any forward-looking statements.