Flare Gas
Flare gas comes out of the well along with the oil, and often it is simply burned off. A generator turns that flame into the cheapest kilowatt hour in mining.
How a flare becomes hashrate
There is nowhere to take associated gas from a remote well: no pipeline, and liquefying it is expensive. For decades it was burned in flares just to get rid of it. Mining was the first working alternative: a gas piston generator right at the wellhead and a container of ASICs next to it.
The economics here are upside down: the fuel costs about nothing, because otherwise it would burn for nothing. You pay for the generator, the containers, maintenance, and people. Even with those costs the kilowatt hour comes out cheaper than almost any grid, and a noticeable share of industrial mining in the US lives on exactly these sites.
There is an engineering price for the cheapness too. The gas composition drifts from well to well and over time, so the generator has to be omnivorous and frequently serviced. A well can run dry or stop for repairs, which is why the containers are built to move.
For the climate it beats a flare: the methane burns out completely in the generator instead of smoking in an open flame, and the energy at least does work. That is why oil companies themselves push flare gas mining: it turns their fine and their headache into a line of income.
The short version
| Fuel | gas that would otherwise burn in a flare |
| Fuel price | about zero |
| What you pay for | generator, containers, service, people |
| Main risks | gas composition and the life of the well |
| Site format | a movable container at the wellhead |
What sets these sites apart
A generator with headroom that tolerates any gas composition: a regular diesel one does not belong here.
Mobility: the container of miners and the generator move along with the live wells.
Autonomous monitoring and watchdogs: the site is hours away by road, and every small thing must fix itself or be fixed remotely.
A contract with the license holder: the legal part here is harder than the technical one, the gas does not belong to the miner.
How such a site is laid out
A well, a megawatt gas piston generator next to it, and two containers of ASICs. The gas that was smoking in a flare a year ago now spins the generator. When the well's output drops, the site moves to the next one within a week: in this business, wheels matter more than foundations.
Related terms
Where to go next on the site
Hardware
- ASIC Miner knowledge base
Numbers
Questions and answers
Is this within reach for a small miner
Practically no: you need a contract with an oil company, generation, and people on site. A small miner meets this world as a hosting client on such a site.
Why is the gas almost free
Because the alternative is a flare: there is nowhere to put the gas, and in many countries burning it openly also draws fines. The miner takes the problem away, and that is the discount.
Does this exist in Europe
The scale does not compare with the US: fewer wells, stricter regulation. The closest European cousin is mining on surplus biogas and small hydro.
How the terms connect
Every link in the chain is clickable. Orange marks where you are now.
Looking for an ASIC miner
The catalog holds 212 models. You can compare them by hashrate and by joules per terahash, then plug your own rate into the calculator and see what stays in your pocket.
Page written and checked by Denys Klimchuk. Updated .