Second crypto mine 'proceeding' despite N.B. Power freeze, company says

The proponent of a second cryptocurrency mine in New Brunswick says the project is still alive, despite concerns from both the government and N.B. Power that the industry would put a strain on the provincial power grid.

Chief Fuels said in a press release Thursday that its plans are "proceeding on schedule" and the facility will open in Grand Falls in early 2024.

The company said it has hired a contractor to develop the mine's electrical substation to draw energy from N.B. Power's grid, which the utility worries could be overburdened if more cryptocurrency mines were also on the system.

In March 2022, Premier Blaine Higgs signed a cabinet order endorsing the utility's refusal to service new crypto mines.

"The benefit you get back from that versus the consumption of energy it was just not a project that made sense for the province," Higgs said Friday.

But it appears the utility signed an agreement to power the second Grand Falls plant before the freeze was put in place.

Spokesperson Dominique Couture wouldn't comment on the Chief Fuels proposal by name, but said "prior to the pause coming into effect in 2021, two customers completed their interconnection agreements."

Chief Fuels president Michael Scully turned down an interview request from CBC News and did not respond to follow-up questions sent by email.

Such "mines" run thousands of computers around the clock to conduct millions of transactions and earn cryptocurrency, consuming large amounts of electricity.

Demand on the grid is a concern for N.B. Power because several of its generating stations face uncertain futures or reliability issues.

The utility came close to not being able to meet an all-time peak demand for electricity during a cold snap in February.

One bitcoin mine owned by Hive Blockchain Technologies is already operating in Grand Falls. It uses 70 megawatts of power a year.

Chief Fuels said in its release it has scaled back its original plan for a 50-megawatt mine to 26 megawatts "due to various commercial considerations."

It said it has "informed" N.B. Power of that change.

No comment from Grand Falls

The mine was announced in November 2021 when Taal Distributed Information Technologies Inc.said it would buy Chief Fuels and set up the mine in a former McCain Foods fertilizer plant in Grand Falls.

The combined annual electricity consumption of the Hive and Taal mines, 96 megawatts, is close to the yearly generation of the small modular nuclear reactor model being developed by Arc Clean Energy of Saint John.

A Grand Falls town official said last week she was not sure why the Taal-Chief Fuels mine had not opened yet.

Economic development director France LeMoignan said the town received the Chief Fuels press release on Thursday.

"We cannot comment on the situation until a permit has been issued by the municipality's planning department," she said in an email.

She said "discussions" have taken place with the town "but no official documentation has yet been issued."

Chief Fuels describes itself as a majority Indigenous-owned fuel and lubricant company "affiliated" with Michaud Petroleum, a Grand Falls company.

On its website, Chief Fuels lists its address on Waasis Road at Oromocto First Nation.

Taal said in a November 2021 press release it was acquiring all the shares in Chief Fuels, allowing it to open its crypto mine in a 5,600-square-metre warehouse in Grand Falls.