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The Data Center Will Generate 1.265 EH/S by 2Q 2021 with an Option to Expand to 3.320 EH/S. Marathon Will Own 100% of the Data Center, Which Will Have One of the Lowest Energy Costs in the U.S. for a Bitcoin Mining Operation.
Beowulf Presently Owns and Manages Over 2.3 Gigawatts of Electric Generating Capacity; Beowulf has Earmarked 500 Megawatts for Future Blockchain and Data Center Expansion
LAS VEGAS, Oct. 13, 2020 (GLOBE NEWSWIRE) -- Marathon Patent Group, Inc. (NASDAQ:MARA) ("Marathon" or "Company") today announced the formation of a new joint venture with Beowulf Energy LLC (“Beowulf”) focused on delivering low cost power to Marathon’s Bitcoin mining operations.
In connection with the joint venture, Marathon has entered into agreements with Beowulf to co-locate its Bitcoin Mining Data Center (the “Data Center”) at the Big Horn Data Hub, which comprises 20 acres of land adjacent to Beowulf’s Hardin Generating Station, a 105 MW power facility located in Hardin, Montana. Beowulf will provide power from the Hardin plant to the Data Center at a production cost of $0.028/kWh. Beowulf will also become an equity shareholder of Marathon as a result of the joint venture. Marathon will retain 100% of the Bitcoin mining output generated at the Data Center.
Marathon will deploy the 11,500 next generation S19 Pro Antminers (110 TH/s) it previously acquired through its partnership with Bitmain Inc. at the Data Center. These miners will generate 1.265 EH/s when fully deployed, with full deployment anticipated through Q2 2021. Currently, 500 of the S19 Pro Antminers have been delivered and deployed at the Data Center. The Data Center has the capacity to deploy up to 30,000 S19 Pro Miners that will generate 3.320 EH/s, providing Marathon with substantial opportunity for future expansion.
The Data Center will lower Marathon’s aggregate mining cost for electricity and data center management to $0.034/kWh, which is 38% below the Company’s current cost of mining. This low-cost electricity reduces Marathon’s breakeven costs to produce Bitcoin from approximately $7,500 per Bitcoin today to $4,600 per Bitcoin, dramatically improving the Company’s future profitability.
Marathon Chairman and CEO Merrick Okamoto stated, “The closing of this joint venture with Beowulf represents the completion of a long journey to own a Bitcoin mining facility. Partnering with an experienced independent power producer enables us to maintain control and certainty of Marathon’s energy and operational costs, at rates that represent some of the lowest in North America.”
Nazar Khan, Executive Vice President of Beowulf, commented, “In pursuing the co-location of a Bitcoin mining operation at Hardin, we sought to capture the inherent value to the Data Center of securing a long-term supply of reliable, secure, and low-cost power while benefitting from the significant on-site technical expertise to ensure efficient operations. Our expert in-house engineers and technicians have designed the Data Center to support the immense computing speeds of the latest generation S19 Pro Antminers. Located in Eastern Montana, the Data Center has a meaningful competitive advantage on energy pricing, moderate climate, and regulatory stability. Beowulf has also earmarked an additional 500 megawatts of generation capacity for subsequent blockchain and data center expansion.”
Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under "Risk Factors" in Item 1A of our most recent Annual Report on Form 10-K for the fiscal year ended December 31, 2019. If any of these risks were to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline, and you could lose part or all of your investment. The risks and uncertainties we describe are not the only ones facing us. Additional risks not presently known to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicator of future performance, and historical trends should not be used to anticipate results in the future. Future changes in the network-wide mining difficulty rate or Bitcoin hashrate may also materially affect the future performance of Marathon's production of Bitcoin. See "Safe Harbor" below.
Statements made in this press release include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements can be identified by the use of words such as “may,” “will,” “plan,” “should,” “expect,” “anticipate,” “estimate,” “continue,” or comparable terminology. Such forward-looking statements are inherently subject to certain risks, trends and uncertainties, many of which the Company cannot predict with accuracy and some of which the Company might not even anticipate and involve factors that may cause actual results to differ materially from those projected or suggested. Readers are cautioned not to place undue reliance on these forward-looking statements and are advised to consider the factors listed above together with the additional factors under the heading “Risk Factors” in the Company's Annual Reports on Form 10-K, as may be supplemented or amended by the Company's Quarterly Reports on Form 10-Q. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events, new information or otherwise.
About Marathon Patent Group
Marathon is a digital asset technology company that mines cryptocurrencies, with a focus on the blockchain ecosystem and the generation of digital assets.
About Beowulf Energy
Founded in 1994, Beowulf is an independent infrastructure company that develops, builds, owns, and operates power generation and industrial infrastructure facilities worldwide. Headquartered in Maryland, the company has extensive development and operational experience in domestic and international energy markets. Beowulf has developed, constructed, acquired, and operated over $5 billion of power generation and industrial assets. Beowulf is led by its founder, Chairman, and Chief Executive Officer, Paul B. Prager.
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Matt Glover and Charlie Schumacher