Scrubgrass Generating Plant Parent Company Raises $105M to Power Bitcoin Mining

Aly Delp

Aly Delp

Published June 25, 2021 4:45 am

VENANGO CO., Pa. (EYT) — Stronghold Digital Mining, Inc., which operates the Scrubgrass Generating Plant near Kennerdell, recently announced it has completed two private placements of equity securities raising a total of $105 million to power the mining of Bitcoin and other cryptocurrencies.

Investors were granted registration rights that require a future public listing.

Stronghold Digital Mining is led by Greg Beard, Co-Chairman and CEO, and Bill Spence, Co-Chairman.

Greg Beard previously served as Senior Partner and Head of Natural Resources at Apollo Global Management Inc., while Bill Spence has 40 years of energy-related experience and was a pioneer in the operation of and fuel sourcing for coal refuse plants.

Stronghold’s initial power generation facility, the Scrubgrass Generating Plant in Venango County, converts waste coal, a legacy waste from decades of coal mining which is classified by the Commonwealth of Pennsylvania as a Tier II alternative energy source (equivalent to a large-scale hydropower plant), into power that is used to mine Bitcoin and other cryptocurrencies. The operation of this power generation facility with coal refuse allows the reclamation of large geographic areas that have been ravaged by the presence of waste coal.

Waste coal acid mine drainage (AMD) is the largest source of water pollution in the state of Pennsylvania. Precipitation, in the form of rain or snow, combines with the sulfur in the waste coal to form AMD. The AMD runs off into nearby streams and rivers threatening aquatic life downstream. By removing these waste coal dumps, Stronghold Digital Mining’s Scrubgrass Plant is eliminating the source of the AMD at the site, before donating the land back to local communities.

“Coal waste fires have been wreaking havoc in my home state of Pennsylvania for the last hundred years,” said Bill Spence, Co-Chairman of Stronghold.

“Not only are these coal fires a major source of greenhouse gases, but the acid runoff and ash from these uncontrolled burning piles pose serious threats to the health, environment, and water quality of the surrounding communities. Simply put, we employ 21st-century crypto mining techniques to remediate the impacts of 19th and 20th-century coal mining in some of the most environmentally neglected regions of the United States.”

Operating in partnership with the Pennsylvania Department of Environmental Protection (DEP) and local environmental authorities, Stronghold has already reclaimed 1,000 acres of once-unusable land in Pennsylvania. By removing waste coal from and helping reclaim these abandoned sites, Stronghold restores local waterways once void of aquatic life and vegetation and reduces the toxicity of the sites, making them safer for families and residents.

Stronghold and Scrubgrass’s technology removes ~90% of NOx emissions, ~99.9% of particulate emissions, ~99.9% of mercury emission, and can remove ~98% of SO2 emissions. Additionally, the fly ash produced by Stronghold is classified as fertilizer and has been awarded an agriculture liming materials license by the Commonwealth of Pennsylvania’s Department of Agriculture.

Stronghold Digital Mining estimates that it will take at least thirty years to reclaim the harmful coal waste in close proximity to the Scrubgrass Plant. For each Bitcoin mined by the company, an estimated 200 tons of waste coal is eliminated.

“A negative impact on the environment has long been a criticism of Bitcoin mining, with good reason. Our ownership of the Scrubgrass Plant combined with the environmental benefits which accrue to the region allow us to mine Bitcoin at what we believe to be some of the lowest costs in the industry while making a transformational contribution to the environment. Our vertically integrated model ensures we’re entirely self-sufficient and adaptable,” said Greg Beard, CEO and Co-Chairman of Stronghold.

The company expects to have over 28,000 cryptocurrency miners operating by year-end and is currently in negotiations to acquire additional environmentally beneficial facilities with over 200 megawatts of power capacity. Stronghold’s vertically integrated model provides access to low-cost and geographically advantaged power to mine Bitcoin and other cryptocurrencies.

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