Union Jack Oil (UJO), a UK-listed oil and gas company, has explored a new path to monetizing gas resources by relying on Bitcoin mining, in accordance with a statement on August 7th.
The move focuses on leveraging natural gas from the West Newton site in East Yorkshire to generate electricity to power crypto mining operations, according to the company.
Why Bitcoin mining?
Union Jack’s Executive Chairman David Blumhill expressed confidence in the project’s potential, noting that the Bitcoin mining strategy could lead to the creation of new Bitcoin financial strategies for oil and gas companies.
To achieve this, the company stated it Its joint venture partners, including Rathlin Energy and Reabold Resources, have signed a non-binding Intent Letter of Intent (LOI), featuring 360 Energy, a Texas-based company specializing in natural gas monetization.
The agreement outlines the strategy for installing gas-powered power infrastructure and Bitcoin mining units directly at production sites.
The initiative aims to power up onsite data centers using West Newton A and B Wells gas. Speaking about these centres, Bramhill said:
“We continue to believe that this asset retains material value and ultimately can bring large quantities of low-carbon sales of land gas to the UK’s domestic natural gas market. West Newton is estimated to contain nearly 200 billion cubic feet of total recoverable 2C gas resources, according to an independent valuation undertaken by RPS in 2022.”
These centers run a 360-energy “in-field computing” (IFC) system.
According to Union Jack, these early production concepts allow us to unlock value from existing wells without waiting for full field development. If successful, the model can be replicated with other nearby discoveries.
Mining difficulties increase rapidly
Union Jack’s Bitcoin Mining Plan comes at an interesting time when the difficulty of Bitcoin Mining is rising.
According to data from Cloverpool, the difficulty of Bitcoin mining is expected to surge to an all-time high of over 130 trillion on August 9th.
Despite this milestone, wider growth in mining activities appears to be slowing.
Insights from Blockware show that mining difficulty has increased from the beginning of the year only 16%. If this pace applies, 2025 can be registered as the slowest year in Bitcoin history for mining difficulties.
The slowdown is primarily due to mature hardware capabilities, infrastructure limitations, and increased interest among data center operators in alternative sectors such as artificial intelligence.
Blockware suggests that this slowdown in mining difficulty is ultimately bullish for Bitcoin miners.