The short version: In a recent sit-down with the Dirty Coin team, U.S. Senator Cynthia Lummis (R-WY) walked us through one of the more unexpected developments in the Bitcoin mining industry: miners co-locating at oil and gas wells to use natural gas that would otherwise be flared into the atmosphere. She frames it as an environmental benefit. Critics raise reasonable questions about scale and unintended consequences. Below: what she said, how the practice actually works, and what's still being worked out.
What Sen. Lummis Said
Her explanation of the practice was direct and specific:
"When an oil and gas well is drilled, some of the excess gas is flared before a gathering line can be buried and hooked up to the well to take the gas away. That flaring means that gas is going into the air unused. So they're taking what is an unused product and asset, and they're pulling up mining equipment right next to the oil and gas wells, plugging them into that source of energy, and mining for Bitcoin on site next to these wells. So it is an environmental benefit to have those kinds of opportunities brought to an oil and gas well that has not yet been connected to a pipeline."
— Sen. Cynthia Lummis (R-WY)
Whether or not you land where she does on the "environmental benefit" framing, the practice she's describing is real and deployed across U.S. oil fields right now. So it's worth understanding — both on its own terms and as part of the broader story of how Bitcoin mining is showing up in the energy conversation.
What Is Flare Gas Bitcoin Mining?
Flare gas Bitcoin mining is the practice of using natural gas that would otherwise be flared at an oil or gas well — burned off as a byproduct — to generate electricity that powers Bitcoin mining equipment on-site at the wellhead.
The basic mechanics:
1. The gas problem. When oil is extracted from a well, natural gas often comes up alongside it. In remote locations — rural Wyoming, the Bakken Shale in North Dakota, parts of the Permian Basin in Texas — there's often no pipeline available to move that gas to market. Producers are typically left with two options: vent the gas (releasing methane, which is a far more potent greenhouse gas than CO₂ in the short term), or flare it (burning it on-site).
2. The mining setup. Mining companies arrive with portable, modular generators and ASIC mining containers — equipment designed to be deployed and relocated as production shifts. The flared gas is captured before reaching the flare stack, fed into on-site generators, and converted into electricity.
3. The Bitcoin layer. That electricity powers ASIC miners performing the computational work that secures the Bitcoin network. Operators earn Bitcoin as the reward; the producer can earn revenue on a resource that previously had no economic outlet.
Operators in the space report meaningful reductions in methane emissions compared to open-flame flaring, on the theory that combustion in a controlled engine burns more completely than combustion in an open flare. The actual emissions math varies considerably from site to site, and depends on the specifics of the well, the equipment, and how the operator accounts for it. We get into some of that below.
Why Wyoming Comes Up
Sen. Lummis represents Wyoming, which has built out more state-level legislation around digital assets than any other state in the country. From the same conversation:
"Wyoming is the first state that crafted a comprehensive set of state legislative statutes to integrate digital assets into the state's economy. We were the first state to have a special purpose depository institution statute and other statutes as well that create a really positive home environment for companies working in the digital asset space."
Wyoming's energy mix — significant natural gas production, growing wind capacity, and pockets of stranded power in rural areas — also makes it a natural test bed for the kind of co-located mining she's describing. She told us that some of the state's rural electric cooperatives have been working directly with miners to put excess capacity to use rather than letting it sit idle.
The Bigger Picture: Bitcoin Mining and the Grid
Flare gas mitigation is just one slice of the broader argument Sen. Lummis tends to make about Bitcoin mining. The wider point is about miners as a flexible, location-independent energy consumer — one that can switch on when there's surplus power on the grid and switch off when demand spikes elsewhere.
"Bitcoin mining can help smooth out the peaks and the valleys and have sustainable long-term energy use that is much more efficient for the electric grid... Because when the peaks and valleys occur, they have to ramp up their systems and then reduce them again, which creates inefficiencies within the system."
It's an argument that's gotten more serious attention as the U.S. grid faces unprecedented load growth from AI data centers, electric vehicles, and broader electrification. Whether Bitcoin miners turn out to be a meaningful part of the solution — or a footnote — is one of the open questions the next few years will answer.
Open Questions Worth Watching
Flare gas Bitcoin mining is real, growing, and worth taking seriously. It's also new enough that several important questions don't yet have settled answers:
- Does it scale? Existing deployments are still a small fraction of total flaring globally. Whether the model can grow into a meaningful percentage of the world's roughly 145 billion cubic meters of annually flared gas is genuinely uncertain.
- Counterfactuals matter. "Would this gas have been flared anyway?" is harder to answer than it sounds. In some cases, mining is consuming gas that would otherwise be vented or burned with no economic value. In others, the presence of a Bitcoin mine may marginally extend the productive life of a well that otherwise would have been shut in. Honest analysis depends on the specific case.
- Methane slip is real. Combustion engines aren't perfect. A small fraction of methane can pass through unburned, which somewhat offsets the emissions advantage over open flaring. The size of that offset varies by equipment.
- Regulators are catching up. Most state and federal frameworks weren't written with mobile, on-site Bitcoin mining in mind. How regulations evolve will shape whether the practice grows or contracts.
- The fossil fuel question. Some critics argue that any practice that adds revenue to oil and gas operations indirectly subsidizes the fossil fuel sector. Supporters counter that mining is consuming a waste stream rather than incentivizing new drilling. Reasonable people land in different places.
This is part of why we made Dirty Coin in the first place: to actually go to these sites, talk to the people building them, and look at what's working, what isn't, and what we're still learning.
Frequently Asked Questions
What is flare gas Bitcoin mining in simple terms?
Bitcoin miners set up portable equipment near oil and gas wells, capture natural gas that would otherwise be flared as waste, and use it to generate electricity for their mining operations. The practice can convert a waste stream into productive energy and may reduce methane emissions, depending on the specifics of the deployment.
Who actually operates flare gas Bitcoin mines?
Crusoe Energy Systems is among the better-known early operators in the U.S., having deployed "Digital Flare Mitigation" infrastructure across multiple oil fields. Other operators include MARA, Cathedra Bitcoin, and a growing roster of smaller and independent companies. Major oil and gas producers — including ExxonMobil — have also run pilot programs.
How much natural gas gets flared globally?
The World Bank estimates that more than 145 billion cubic meters of natural gas were flared worldwide in 2023 — roughly the energy equivalent of two-thirds of Europe's annual electricity consumption.
Why does Sen. Cynthia Lummis talk about this?
Sen. Lummis represents Wyoming, a major U.S. energy producer, and chairs the Senate Banking Subcommittee on Digital Assets. She has been one of the more visible voices in Congress on Bitcoin and digital asset policy, and her interest in the energy side of the conversation reflects both her constituency and her policy focus.
Where can I learn more?
Dirty Coin, the documentary by Puerto Rican filmmaker Alana Mediavilla, is a global investigation into Bitcoin mining and energy — from oil fields in Texas to hydroelectric plants in Malawi to wind installations in Paraguay. It won Best National Documentary at the Puerto Rico Film Festival. Stream it, host a screening, or pre-order the DVD →
Watch the Full Conversation
This clip is one moment from a longer conversation with Sen. Lummis, and one chapter of the larger story we set out to tell in Dirty Coin. The film travels across nine countries to look at what Bitcoin mining is actually doing on the ground — what's working, what's contested, and what's still being figured out.
→ Watch Dirty Coin — stream it, host a screening, or pre-order the DVD.
→ Subscribe to our YouTube channel for the full Lummis interview, more conversations with policymakers, miners, and energy researchers, and ongoing coverage of an industry that's still being written.
→ Share this post if it shifted how you think about Bitcoin and energy. The conversation needs more good-faith curiosity — and it spreads when readers pass it on.