Brent Whitehead and Matt Lohstroh at the first unit they built in east Texas.
Matt Lohstroh
The Argentine province of Mendoza is famous for its vineyards and full-bodied Malbecs. But the popular wine region in the foothills of the Andes mountains is also home to the world’s second-largest shale gas reserve called Vaca Muerta, which translates to “dead cow.”
For two Texas-based bitcoin miners, the oil deposit offers a dream resource: wasted energy.
Brent Whitehead and Matt Lohstroh, both graduates of Texas A&M University, have been mining bitcoin on the oil fields of East Texas since 2019. That’s when they founded Giga Energy with the goal of taking flared natural gas and turning it into electricity to run bitcoin mines, which are notoriously power-thirsty.
On Tuesday, Giga announced its first foray into Argentina, following expansion across the U.S. and into Shanghai. The company is partnering with Phoenix Global Resources, an oil and gas company with operations in Mendoza, and with IT services company Exa Tech to launch a two megawatt bitcoin mine on top of Vaca Muerta.
Giga’s system involves placing a shipping container full of thousands of bitcoin miners on an oil well, then diverting the natural gas into generators, which convert the gas into electricity that’s used to power the miners. The process reduces CO2-equivalent emissions by about 63% compared to continued flaring — or burning — of unused gas, according to research from Denver-based Crusoe Energy Systems. It also turns wasted energy into a valuable asset for oil producers.
“By capturing stranded natural gas to power modular data centers for energy-intensive computing, Giga is actively contributing to reducing global methane emissions,” Whitehead told CNBC in an interview. Whitehead comes from a long line of “wildcats,” a term used to describe those who engage in high-risk exploratory drilling.
On the small pilot site in Argentina, Exa Tech is handling operations on the ground, Phoenix Global is providing the gas and Giga is supplying the equipment.
Bitcoin mining operation in the prolific Argentinian oil patch.
ExaTech
Bitcoin mining is particularly lucrative whenever there’s a bull market in the cryptocurrency, making current market conditions particularly ripe for a buildout. Bitcoin has soared 170% in the past six months, touching multiple all-time price highs of late, a rally sparked in part by optimism surrounding the launch of spot bitcoin exchange-traded funds in the U.S.
The boom has helped buoy the share prices of publicly traded bitcoin miners. Riot Platforms more than quadrupled in value last year. CleanSpark jumped more than fivefold in 2023 and is up another 112% this year. Cipher Mining soared over 600% last year and has gained 27% in 2024.
Lohstroh told CNBC that Giga has generated over $10 million in revenue so far this quarter. It’s not the only miner that sees opportunity in Argentina, which ranks 12th on the list of the top global emitters of methane, according to World Bank data.
Crusoe, which helps oil companies like ExxonMobil convert flare gas into a useful resource, helped launch a bitcoin mine at Vaca Muerta in June, as part of an ongoing effort to reduce the energy waste and environmental impacts of natural gas flaring.
Giga’s mine is intentionally small to start and isn’t intended to be profitable yet. The company first wants to make sure it can successfully import all the necessary equipment before scaling the operation. The mine has been running a test since December, and Lohstroh estimates the site has mined in the range of $200,000 to $250,000 worth of bitcoin.
Giga projects the mine is set to reduce CO2 emissions by approximately 180,000 tons per year at the upstream facility. The site is also designed to sell any excess power to the Argentina grid as a way to both generate revenue and curb operational redundancies.
Bitcoin mining operation in the prolific Argentinian oil patch.
ExaTech
Crypto is popular in Argentina
It helps that bitcoin isn’t a hard sell in a country whose residents have long faced economic instability and wild currency fluctuations.
Vitalik Buterin, the co-creator of ethereum, previously told CNBC that crypto has far greater use cases in Argentina than in many other parts of the world, noting that he found coffee shops that accepted bitcoin and ether.
″When I visited Argentina back at the end of 2021, lots of people used crypto, lots of people loved crypto,” Buterin sad. “I literally got recognized on the streets of Buenos Aires more often than I got recognized in San Francisco.”
Argentina’s president, Javier Milei, said at the World Economic Forum in January that “shock therapy” is the only way to address the profound crisis facing his country. One tactic involved devaluing the national currency by 50% in an effort to curb inflation. Milei, who took over as president in December, has embraced bitcoin and has proposed dollarizing the economy, as well as abolishing the central bank and privatizing the pension system.
“We started this before Milei went into office,” Lohstroh said. “I think it’s pretty interesting that in lockstep, in stride, we’re turning this equipment online in the region, as it’s becoming dollarized and becoming more stable and giving real investment dollars into the economy.”
Federico Brom, Exa Tech’s director of business development, says Argentina has “basically banned imports” as a way to protect its currency. That could be a headwind for scaling the bitcoin mining business.
Still, Brom said he’s seen “a lot of support, a lot of hype and a lot of interest” in what they’re offering.
On today’s episode of Quick Charge we explore the uncertainty around the future of EV incentives, the roles different stakeholders will play in shaping that future, and our friend Stacy Noblet from energy consulting firm ICF stops by to share her take on what lies ahead.
We’ve got a couple of different articles and studies referenced in this forward-looking interview, and I’ve done my best to link to all of them below. If I missed one, let me know in the comments.
New episodes of Quick Charge are recorded, usually, Monday through Thursday (and sometimes Sunday). We’ll be posting bonus audio content from time to time as well, so be sure to follow and subscribe so you don’t miss a minute of Electrek’s high-voltage daily news.
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EV sales kept up their momentum in December 2024, with incentives playing a big role, according to the latest Cox Automotive’s Kelley Blue Book report.
December’s strong EV sales saw an average transaction price (ATP) of $55,544, which helped push the industry-wide ATP higher, according to Kelley Blue Book. The December ATP for an EV was higher year-over-year by 0.8%, slightly below the industry average, and higher month-over-month by 1.1%. Tesla ATPs were higher year-over-year by 10.5%.
Incentives for EVs remained elevated in December, although they were slightly lower month-over-month at 14.3% of ATP, down from 14.7% in November.
EV incentives were higher by an impressive 41% year-over-year and have been above 12% of ATP for six consecutive months. Strong sales incentives, which averaged more than $6,700 per sale in 2024, were one reason EV sales surpassed 1.3 million units last year, according to Cox Automotive, a new record for volume and share.
(My colleague Jameson Dow reported yesterday, “In 2024, the world sold 3.5 million more EVs than it did in the previous year … This increase is larger than the 3.2 million increase in EV sales from the previous year – meaning that EV sales aren’t just up, but that the rate of growth is itself increasing.”)
Kelley Blue Book estimated that in December, approximately 84,000 vehicles – or 5.6% of total sales – transacted at prices higher than $80,000 – the highest volume ever. KBB lumps gas cars and EVs together into this luxury vehicle category, so this is where Tesla Cybertruck is slotted.
However, Tesla bundles sales figures of Cybertruck with Model S, Model X, and Tesla Semi(!) into a category it calls “other models,” so we don’t know for sure exactly how many Cybertrucks Tesla sold in Q4, much less in December. However, Electrek‘s Fred Lambert estimates between 9,000 and 12,000 Cybertrucks were sold in Q4, and that’s not a stellar sales figure.
What will January bring when it comes to EV ATPs? What about tax credits? Check back in a month and I’ll fill you in.
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Tesla is now claiming that Cybertruck was the ‘best-selling electric pickup in US’ last year despite not even reporting the number of deliveries.
There’s a lot of context needed here.
As we often highlighted, Tesla is sadly one of, if not the most, opaque automakers regarding sales reports.
Tesla doesn’t break down sales per model or even region.
For comparison, here’s Ford’s Q4 2024 sales report compared to Tesla’s:
You could argue that Tesla has fewer models than Ford, and that’s true, but Tesla’s report literally has two lines despite having six different models.
There’s no reason not to offer a complete breakdown like all other automakers other than trying to make it hard to verify the health of each vehicle program.
This has been the case with the Cybertruck. Tesla is bundling its Cybertruck deliveries with Model S, Model X, and Tesla Semi deliveries.
Despite this lack of disclosure, Tesla has been able to claim that the Cybertruck has become “the best-selling electric pickup truck” in the US in 2024:
It very well might be true. Ford disclosed 33,510 F-150 Lightning truck deliveries in the US in 2024 while most estimates are putting Cybertruck deliveries at around 40,000 units.
Those are global deliveries, but Tesla only delivered the Cybertruck in the US, Canada, and Mexico in 2024, and most of the deliveries are believed to be in the US.
First off, Tesla had a backlog of over 1 million reservations for the Cybertruck that it has been building since 2019. This led many to believe Tesla already had years of demand baked in for the truck and that production would be the constraint.
However, based on estimates, again, because Tesla refuses to disclose the data, Cybertruck deliveries were either flat or down in Q4 versus Q3 despite Tesla introducing cheaper versions of the vehicle and ramping up production.
Again, that’s after just about 40,000 deliveries.
Furthermore, with almost 11,000 deliveries in Q4 in the US, Ford more likely than not outsold Cybertruck with the F-150 Lightning in Q4.
Electrek’s Take
Tesla is in damage control here. There’s no doubt that it is having issues selling the Cybertruck.
Inventory is full of Cybertrucks and Tesla is now discounting them and offering free lifetime Supercharging.
Tesla is great at ramping up production, and it’s clear the Cybertruck is not production-constrained anymore. It is demand-constrained despite having over 1 million reservations.
Again, those reservations were made before Tesla unveiled the production version, which happened to have less range and cost significantly more.
The upcoming cheaper single motor version should help with demand, but I have serious doubts Tesla can ramp this program up to more than 100,000 units in the US.
As a reminder, Tesla installed a production capacity of 250,000 units annually and Musk said he could see Tesla selling 500,000 Cybertrucks per year.
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