LandBridge, a US firm specializing in acquiring land for oil and gas production, to attract crypto miners in its future strategy.
LandBridge, a United States company that acquires vast tracts of land for oil and gas production, has announced its intention to pursue cryptocurrency miners as part of its future strategy. This announcement was made with the company’s initial public offering (IPO) on Monday.
The company announced on June 17 that it would be offering 14.5 million shares for $19 to $22, which could result in a valuation of up to $1.6 billion. It intends to be listed on the New York Stock Exchange under the “LB.”
LandBridge’s regulatory filings indicate that it possesses approximately 220,000 surface acres in and around the Delaware subbasin, which is abundant in oil and natural gas, in the Permian Basin region of Texas and New Mexico.
LandBridge proposed that its land could be utilized for purposes beyond oil and gas production. Also, access to water, roadways, fiber optic infrastructure, and power could be advantageous for crypto miners and data centers, and the organization could generate substantial revenue by charging them for these services.
“We have identified and are currently pursuing opportunities to receive surface use payments from crypto currency mining, data centers, power storage facilities and commercial fueling stations.”
According to LandBridge, it has already established one “crypto currency facility” on its property. In 2023, it generated $52.1 million in non-oil and gas-related royalty revenue, encompassing crypto miners. This represents a 56% increase from the previous year.
“We would not own or operate such projects or expect to incur significant capital expenditures in connection therewith,” it further stated.
However, LandBridge anticipates collecting “receive surface use fees and other payments in connection with the utilization of our land,” which includes fees for the water it provides to crypto miners to maintain the temperature of their devices.
Its land is strategically located to attract crypto miners who have relocated to Texas due to its affordable electricity and accommodating regulatory framework. However, the state legislators are activating the power-hungry crypto miners and artificial intelligence data centers.
According to Pablo Vegas, the executive director of the ERCOT organization, the demand for crypto and AI is causing strain on Texas’ power grid, as reported by local media earlier this week.
On June 12, Texas Lieutenant Governor Dan Patrick wrote to X,“We need to take a close look at those two industries,” “They produce very few jobs compared to the incredible demands they place on our grid.”
