Two mothballed gas sites in East Yorkshire could be used for cryptocurrency mining, company announcements revealed today.

Partners in the West Newton sites in Holderness unveiled plans to use gas from the wells to generate electricity needed to mine Bitcoins. Links to announcements here and here

The operator, Rathlin Energy, has entered a non-binding agreement with the Texas-based company, 360 Energy Inc, to design what was called a Bitcoin mining solution.

Rathlin said last year that it did not have enough money to meet its drilling and abandonment commitments at West Newton.

Today’s announcements said the scheme offered “an innovative and significant near-term value generating opportunity, providing early production and cash flow in advance of any planned full gas field development decision”.

But there have been sceptical comments this morning from investors in Reabold Resources and West Newton’s other partner, Union Jack Oil.

According to the announcements, the plan would begin at West Newton-A, with an onsite data centre powered by electricity generated by burning gas from the A2 well. The project would later be rolled out for the West Newton-A1 well and at West Newton-B with the B1z well.

The scheme is expected to need planning consents.

West Newton-A currently has permissions for 20 years of gas production but no work has been carried out at the site for six years. The site is currently seeking environmental consent for lower-volume hydraulic fracturing of the A-2 well.

At West Newton-B, there is planning permission for an additional well but not gas production. No work has been carried out at West Newton-B since December 2020.

Reabold Resources, which has a 79.8% shareholding in Rathlin Energy, said Bitcoin mining would “complement both the early production scheme and the full field development” at West Newton.

Sachin Oza, co-chief executive of Reabold Resources, said:

“We believe that the creation and accumulation of new Bitcoin through mining operations offers a significantly enhanced, sustainable return, and one which is superior to simple cash purchases and accumulation of Bitcoin on the balance sheet, popularly referred to as a Bitcoin treasury strategy.

“The accumulation of mined Bitcoin, taking advantage of Rathlin’s access to extremely low cost energy, is both a precursor and supplement to the unlocking of the substantial low-cost natural gas at West Newton, which we believe will play an invaluable role in UK energy security in the years ahead.”

He also suggested that West Newton’s low operating costs would make it “ideal” for powering artificial intelligence data centres.

Mr Oza and his co-chief executive, Stephen Williams, are directors of Kryptobyte Limited. It changed its name today from Yorkshire Data Centre Services Limited. Before that it was known as Reabold Investments UK Limited. In April 2025, the company filed accounts for a “dormant company”.

Union Jack, which has a 16.665% interest in the West Newton field, said:

“The relationship with 360 Energy has the potential to enable the Joint Venture partners to realise significant returns from natural gas volumes via wells that would not otherwise contribute to either the early production scheme or the full field development”.

Union Jack’s executive chairman, David Bramhill, said “regulatory uncertainty” had hampered progress at onshore projects, like West Newton. Onshore developers had been “forced to ‘think outside the box’ in order to make progress and deliver growth”, he said.

Last year, operators of a suspended oil site in West Sussex suggested geothermal heat could be used for tea production. (The scheme was not implemented and the site no longer has planning permission.)

Mr Bramhill added:

“The Board of Union Jack believes this proposed concept to produce Bitcoin through mining operations is innovative, offers strong scope for a sustainable return and could lead to the Company introducing a new Bitcoin Treasury strategy, on success.

“In addition, we believe that 360 Energy’s association with West Newton is complementary to Union Jack’s position as a profitable, transatlantic oil and gas business with production in both the UK and USA.”

“Pure theatre”

One Union Jack shareholder said “beware of the ‘Emperor’s new clothes”. Another described it as a “a gimmick”. Another said: “Gas-to-bitcoin will never happen, it’s pure theatre”.

Bitcoin mining – the validation of transactions in the cryptocurrency – demands large amounts of electricity

The IMF estimated a year ago that one Bitcoin transaction required about the same amount of electricity as the average person in Ghana or Pakistan consumes in three years.

One Union Jack investor questioned whether West Newton could generate enough electricity to meet demands.

Comments on Reabold Resources’ announcement were also sceptical. The company’s share price fell this morning from 0.06p to 0.052p. One comment said: “The market is understandably unimpressed.”

Another said: “more pie in the sky”.  Another said: “On the face of it this appears to be bandwagon stuff”. But the comment added that high demands for energy from AI could be a loophole for oil and gas companies through net zero policies.

Cryptocurrency is expected to generate greenhouse gas emissions. The IMF estimated crypto mining could generate 0.7% of global carbon dioxide emissions by 2027.

Rathlin Energy says on its website that it understands that climate change is a global concern but its gas project at West Newton “aligns with the UK’s commitment to net zero carbon emissions by 2050”.