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AECO gas is worth $1.43 per thousand cubic feet on a 12-month futures contract and Colcleugh said the company, at times, pays up to $1.30 per mcf in processing and transportation fees, which eliminates most of his natural gas earnings.

As a result, Colcleugh plans to burn that gas and produce electricity and use that electricity to power computer hardware mining cryptocurrency tokens.

Assuming that 215 kilowatt hours of electricity are needed to produce one Bitcoin, GMP FirstEnergy vice-chairman and co-head of energy sales and trading Trent Boehm estimated in a note sent to clients this week that Iron Bridge could earn US$49 per mcf for its gas.

That’s more than 30 times the price Iron Bridge currently receives for its gas, assuming current AECO and Bitcoin prices.

“As far as I’m concerned, every dry gas producer in the industry should get a lift on this news, because boards of directors are going to wonder why companies couldn’t dedicate a portion of their production to this,” Boehm said.

For his part, Colcleugh said that even if the price of Bitcoin or other cryptocurrencies do collapse, the venture would still be worthwhile given how low AECO prices have fallen.

“The economics are very variable based on the coins but the numbers suggest there’s an awful lot of room in here for prices to collapse and still have vastly better returns – even after paying for the equipment – than selling your gas at AECO,” Colcleugh said.

He said Iron Bridge did have an advantage because it was producing electricity anyway, and could scale up its electricity generation to power a 45 MW facility.