AXP Energy (ASX:AXP) has begun installing its first commercial gas-to-power project this month at the Edwards Lease in Oklahoma, US.
The project uses a 320 kilowatt (kW) natural gas generator fuelled by production from the Charlie #1 well to power digital infrastructure equipment.
Under the arrangement with Pathfinder Partners, AXP supplies natural gas while Pathfinder operates the Australian Securities and Investments Commission (ASIC) mining equipment.
The Oklahoma deployment follows a successful proof-of-concept completed in Colorado, US, where the companies demonstrated the viability of converting produced natural gas into on-site power for high-performance computing applications.
CEO Daniel Lanskey says the Edwards Lease installation represents the next step in demonstrating how AXP can create additional value from its natural gas production.
“Following the successful trial in Colorado with Pathfinder Partners, the Edwards Lease installation is the next step in demonstrating how AXP can create additional value from its natural gas production,” Lanskey notes.
“We are applying the learnings from Colorado to deliver a more efficient operation in Oklahoma with much lower operating costs.”
The Charlie #1 well currently produces approximately 80,000–90,000ft3 of gas per day. The company notes production is temporarily being choked back, indicating potential upside.
Under the current agreement, AXP generates revenue from gas sales while limiting capital investment during the initial deployment phase. The company has the option to acquire the generator within 90 days of installation.
AXP retains all revenue from oil production at the Edwards Lease and is assessing other offtake opportunities to deliver scaled gas supply beyond Charlie #1’s current output.
Installation and commissioning are expected to occur this month, with the site expected to be operational early next month.
AXP Energy is an oil and gas production and development company with core operations in Colorado and Oklahoma, US.
Write to JC Villarba at Mining.com.au
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