Tag: crude

Middle Eastern Oil Giants Go On LNG Buying Spree

With strong government backing and billions of dollars at their disposal, Middle Eastern oil giants are aggressively expanding into the global liquefied natural gas (LNG) market, aiming to nearly double their LNG capacity within the next decade. Companies like Saudi Aramco, Abu Dhabi National Oil Co. (ADNOC) and QatarEnergy are investing heavily in LNG production and trading, driven by the growing demand for natural gas as a transition fuel and a desire to diversify their portfolios beyond crude.

“LNG seems to be still the best bet across all different hydrocarbon commodities,” Ogan Kose, managing director at business consulting firm Accenture, told Bloomberg, adding that margins from LNG  investing and trading are “almost unheard of in any other hydrocarbon commodity.”

Whereas natural gas usually plays second fiddle to oil in global energy markets, LNG is seeing sustained demand and faster growth thanks to its role as a bridge fuel in the transition to renewable energy. However, many LNG projects have been hit by delays and large cost overruns, needing extra cash to get them to completion. This opens up an opportunity for cash-rich Gulf nations to flex their energy, financial, and geopolitical muscle in the space.

Further, the Middle East sees LNG as a golden opportunity to expand their commodity trading desks and close the gap with Europe’s energy trading giants Shell Plc (NYSE:SHEL) and BP Plc. (NYSE:BP). Saudi Arabia, Qatar, Bahrain, Kuwait, and Oman are all looking to expand in LNG trading. Oil and gas trading has become a major income source for oil and gas giants, especially when commodity markets are highly volatile.

And, the deals are coming thick and fast. Four days ago, Adnoc’s investment arm XRG PJSC  made an $18.7 billion offer for Australian fossil fuel producer Santos Ltd. (OTCPK:STOSF), good for a nearly 30% premium to Friday’s close, as the Middle East oil giant seeks to expand its LNG portfolio. Santos is pushing an aggressive investment plan to ramp up LNG output by 50% by the end of the decade. Whereas this strategy has frustrated investors looking for quick, near-term returns, it appears to have paid off by luring in a company like XRG searching for high-growth potential. XRG has been on a gas and chemicals buying spree as it targets an $80 billion enterprise value.

Last year, Qatar Energy kicked off production at the Golden Pass LNG project in Sabine Pass, Texas, project. The Golden Pass LNG project in Sabine Pass is a joint venture owned by QatarEnergy (70%) and ExxonMobil (NYSE:XOM), which owns a 30% stake. This more than doubled QatarEnergy’s North gas field expansion production from 77 million metric tons per annum (MMtpa) to 160 MMtpa. Golden Pass LNG is allowed to export up to 937 billion cubic feet a year of natural gas to Free Trade Agreement (FTA) and non-FTA countries on a non-additive basis over the next 25 years. In April, the JV secured regulatory approval by the  Federal Energy Regulatory Commission (FERC) to commission the project.

Two years ago, Aramco entered the LNG sector after it acquired a strategic minority stake in Australia’s MidOcean Energy for $500 million. Last year, Aramco upped its MidOcean stake to 49% and also agreed to fund the company’s purchase of a 15% stake in Peru LNG from Hunt Oil Company. MidOcean Energy has adopted a growth strategy to create a diversified global LNG business, with the company in the process of acquiring interests in four Australian LNG projects.

Meanwhile, Kuwait Petroleum is in talks with Australia’s Woodside Energy Group (NYSE:WDS) to purchase a stake in its proposed LNG project in Louisiana, U.S, Bloomberg has reported. Back in April, Woodside, Australia’s top gas producer, agreed to sell a 40% stake in the 27.6M metric tons/year Louisiana LNG plant to Stonepeak for $ 5.7B Woodside bought U.S.-based Tellurian for $1.2B in 2024, looking to develop the Louisiana LNG project to meet growing demand for gas. The first phase of the massive project is expected to cost ~$16B.

That said, the LNG craze is not limited to the Middle East. Malaysia’s state-owned oil and gas company, Petroliam Nasional Bhd., and other Southeast Asian companies are all looking to expand LNG production beyond their borders. Overall, the experts say the rapid expansion of LNG markets is a good thing, with a greater pool of suppliers likely to benefit LNG buyers, boost competition, and diversify options.

By Alex Kimani – Jun 22, 2025

Supply Crunch Could Send California’s Gas Prices Past $8

On the heels of my recent article outlining how California’s unique fuel regulations — not corporate price gouging — are driving up gasoline prices in the state, new developments have added urgency to that conversation.

On May 6, California Senate Minority Leader Brian W. Jones (R-San Diego) sent a letter to Governor Gavin Newsom sounding the alarm over what could become an energy and economic crisis in the state. Citing an analysis by University of Southern California professor Michael Mische, the letter warns that gas prices could spike 75% by 2026 — reaching as high as $8.43 per gallon — if two major refineries are allowed to shut down as planned.

This follows Professor Mische’s earlier study, which I referenced in my prior article. His research identified structural factors and policy-driven costs as the primary reasons California gasoline prices are consistently the highest in the nation — not oil company profiteering. These factors include high state taxes, a boutique fuel blend required only in California, and an increasingly constrained refinery landscape.

A Looming Supply Crunch

Two key in-state refineries are scheduled to close in the coming months: the Phillips 66 refinery in Los Angeles by the end of 2025, and the Valero refinery in Benicia by April 2026. Together, these facilities produce approximately 20% of California’s gasoline supply.

Professor Mische’s projections are stark. He estimates that gas prices could reach $6.43 per gallon after the first closure and climb to $8.43 by the end of 2026 after the second. These numbers assume stable crude oil prices. But if global oil markets turn volatile — as they often do — the ceiling could be even higher.

What’s Driving the Closures?

Refining gasoline in California has become increasingly difficult. The state’s stringent environmental rules, such as the Low Carbon Fuel Standard (LCFS), coupled with recent legislation like SBX1-2 and ABX2-1, have layered on costly compliance burdens. Add in uncertainty around future bans on internal combustion vehicles and a hostile investment environment, and it’s not hard to see why refinery operators are opting to exit the state.

The problem isn’t limited to fuel prices. According to Senator Jones’ letter, the closures would also eliminate around 1,300 direct jobs and nearly 3,000 more indirectly. These are good-paying, union and trade jobs in communities that can ill afford the loss. Beyond economics, the closures also increase the state’s reliance on imported fuel — most of which must be transported by ship — raising logistical risks and, arguably, national security concerns.

Why This Matters

The letter from Senator Jones reads as both a policy critique and a plea for realism. It challenges Governor Newsom to reconsider regulations that are squeezing fuel producers out of the state and proposes collaboration with the energy industry to explore solutions. Those could include tax incentives to maintain refining capacity, or temporary relief from some of the more onerous rules that disproportionately affect California refiners.

It’s important to understand that California’s fuel market is largely isolated. The state’s environmental regulations and fuel specifications make it difficult to import gasoline from other states or countries. When refineries close, there aren’t many viable alternatives. And when supply tightens in a market with limited flexibility, prices surge — sometimes dramatically.

Reframing the Debate

Much of the public and political dialogue around gas prices in California has focused on oil company profits and alleged price gouging. But the data simply doesn’t support that narrative.

Multiple independent investigations — including those by the FTC and the California Energy Commission — have found no clear evidence that refiners are colluding or manipulating the market. The price premiums in California are mostly structural, driven by policy choices.

Those choices may reflect environmental priorities, but they also carry economic consequences. Policymakers must grapple with this trade-off, especially as the state’s energy mix continues to evolve.

The Bottom Line

If California continues down a path that discourages in-state refining while failing to address the growing supply gap, residents should brace for more sticker shock at the pump. Gasoline prices of $8 or more per gallon are no longer hypothetical; they are within view if the state doesn’t take action.

To be clear, this is not an argument against clean energy. California can pursue its climate goals and still maintain a stable, affordable energy supply. But doing so will require pragmatic policies that ensure reliability and economic viability — not just ambition.

As I wrote in my previous article, this isn’t about corporate greed. It’s about structural and regulatory decisions that have real-world consequences for working families, small businesses, and anyone who drives a car in California.

The choice isn’t between climate progress and affordable fuel. The choice is whether we make that transition responsibly — or let the market punish those who can least afford it.

By: Oil Price / June 17, 2025 

Canada’s Trigon approves LPG export terminal in Prince Rupert

Subject to securing all necessary legal and regulatory approvals, the C$750 million (about €477 million) facility is projected to start exports in late 2029, significantly enhancing Canada’s objective to be a competitive energy superpower as well its as capacity to serve global energy markets.

“This FID is a pivotal moment for Trigon and for Canada’s energy sector, creating new pathways for Canadian LPG to reach international markets, and driving economic growth, resiliency and opportunity for Canadians,” Rob Booker, CEO of Trigon, commented.

“We’ve come to the table with investment dollars and now we need the federal government to expedite this shovel-ready project that is clearly in the national interest.”

This decision comes with support to advance to this project development stage from the Lax Kw’alaams and Metlakatla First Nations, underscoring Trigon’s commitment to collaborative development and shared prosperity.

“This is about bringing long-term benefits to our people, our land, and future generations, and is the next chapter of development in Prince Rupert. It reflects what’s possible when communities and Nations are true partners who are meaningfully involved from the beginning,” Garry Reece, Chief Councillor, Lax Kw’alaams Band, said.

“The shared prosperity model that Trigon has adopted ensures our communities have a strong voice, a stake and a future in major projects within our territory. We know Trigon will continue to engage with our community and others to ensure this project aligns with the interests and priorities of the Indigenous People within our region,” Chief Robert Nelson, Metlakatla First Nation, highlighted.

The facility also has the backing of the Alberta government, recognizing its strategic importance for Canadian energy producers.

“This is great news for Canada and Alberta. We have some of the largest reserves of natural gas and natural gas liquids in the world and are working hard to meet the growing demand of our partners in Japan, Korea and Asia. This new Indigenous-backed facility will play a major role in the long-term success of these partnerships and in promoting indigenous economic reconciliation,” Brian Jean, Alberta Minister of Energy and Minerals, stated.

As explained, the project also meets the federal government’s recently identified criteria for projects of national interest, which include: strengthen Canada’s autonomy, resilience and security; provide economic or other benefits to Canada; have a high likelihood of successful execution; advance the interests of Indigenous Peoples; and contribute to clean growth and to Canada’s objectives with respect to climate change.

The new infrastructure addresses a pressing need for Canadian energy producers who have faced significant challenges accessing export markets due to capacity constraints at existing Prince Rupert facilities and broader impediments arising from the current western Canadian export monopoly. Trigon’s open-access model will provide much-needed competition and flexibility, as an expansion of Canada’s export capabilities rather than a reallocation of existing capacity.

Strong international demand for Canadian LPG has been confirmed through robust off-take discussions with key partners in Japan, South Korea, and India, demonstrating the global appetite for reliable energy supplies from Canada.

“Canada and Japan are important partners in the Pacific region, cooperating in a wide range of economic fields, including energy. Japan has been increasing LPG import from Canada, achieving stable import volume of two million tonnes in 2024. We welcome the expansion of competitive LPG exports from Canada, contributing to the stable energy supply for Japan,“ Jumpei Yamamoto, Executive Officer, General Manager, Trading and Shipping Department, Astomos Energy Corporation, noted.

“With FID in place, Trigon will continue its ongoing engagement and dialogue with Indigenous communities and the broader public as part of Trigon’s commitment to meeting its consultation obligations and working to advance meaningful economic participation, engagement and reconciliation,” Booker further said.

Trigon’s Board of Directors has given its full approval to proceed, with critical infrastructure already in advanced stages of readiness. Rail access to the site is prepared, and berth loading facilities are ready for integration. Long-lead items necessary for the terminal’s construction have been identified for procurement, ensuring a streamlined development timeline.

In 2024, Trigon handled 9.1 million metric tonnes of dry and liquid bulk products in 2024, maintaining its position as the largest terminal by volume within the Port of Prince Rupert and accounting for almost 40 percent of its total exports.

In related news, Trigon and Ulsan Free Economic Zone Authority (UFEZ) an industrial hub specialized in automotive, shipbuilding, petrochemicals and emerging green industries, signed a memorandum of understanding (MoU) in February this year that will see the two entities establish a framework to expand collaboration on the development of hydrogen-as-ammonia exports from Canada to South Korea.

By: Naida Hakirevic Prevljak / June 16, 2025.

Oil and gas important in times of conflict, Saudi Aramco CEO says

KUALA LUMPUR, June 16 (Reuters) – The importance of oil and gas can’t be underestimated at times when conflicts occur, something that was currently being seen, the head of Saudi oil giant Aramco (2222.SE), opens new tab told an energy conference on Monday.

Aramco CEO Amin Nasser delivered his speech to the Energy Asia Conference in Kuala Lumpur by a video link.

Oil prices jumped last week after Israel launched strikes against Iran on Friday that it said were to prevent Tehran from building an atomic weapon. The fighting intensified over the weekend.

“(History has) shown us that when conflicts occur, the importance of oil and gas can’t be understated,” Nasser said.

“We are witnessing this in real time, with threats to energy security continuing to cause global concern,” he said, without directly mentioning the fighting between Israel and Iran.

Nasser also said that experience had shown that new energy sources don’t replace the old, but added to the mix. He said the transition to net-zero emissions could cost up to $200 trillion, and renewable sources were not meeting current demand.

“As a result, energy security and affordability have at last joined sustainability as the transition’s central goals,” he said.

Aramco is the economic backbone of Saudi Arabia, generating a bulk of the kingdom’s revenue through oil exports and funding its ambitious Vision 2030 diversification drive.

By: Reuters / June 16, 2025

Aegis’ Cryogenic LPG Terminal in Mangalore Set to Transform India’s Energy Logistics

Mangaluru – In a landmark development for India’s energy infrastructure, Sea Lord Containers, a wholly owned subsidiary of Aegis Logistics, has inaugurated a state-of-the-art cryogenic LPG terminal at Mangalore Port. The facility, with a static storage capacity of 82,000 metric tons, marks a significant leap in strengthening the country’s coastal petroleum logistics.

Built by Sea Lord for the Aegis Vopak Terminals joint venture, the terminal is strategically positioned to support India’s growing LPG needs while enhancing storage flexibility and safety. Unlike traditional pressurized storage, cryogenic LPG systems operate at low temperatures and atmospheric pressure, making them more secure and efficient.

The terminal is seen as a response to India’s clean fuel goals, enabling better management of seasonal demand fluctuations, improving energy security, and contributing to a transition away from high-carbon energy sources. Industry observers note this development aligns closely with India’s Maritime Vision 2030 and clean energy frameworks, which emphasize decentralized storage, port carbon reduction, and supply chain resilience.

Equipped with modern safety protocols, environmental safeguards, and automated operations, the facility is operated by Aegis Vopak, a JV with global tank terminal leader Royal Vopak. The terminal’s scale and technological capabilities position it as a future benchmark for green port infrastructure in India.

Experts say the project could become a national model if it ensures transparency, equity in access, and community participation, including inclusive infrastructure development for women and marginalized groups.

By News Karnataka / 14 June 2025

China nurtures pilot projects to build up domestic hydrogen supply chains

China’s National Energy Administration recently called for building up various demonstration hydrogen projects across the country, but local industry participants said it would still take years to transform China’s insular hydrogen ecosystem into an international manufacturing hub.

China is the world’s largest hydrogen supplier. In 2024, the country produced 36.50 million mt of hydrogen, accounting for 35% of the global total supplies, NEA data showed. However, over 98% of the supplies were produced from coal, natural gas or as industrial byproducts, instead of renewable-based water electrolysis.

Furthermore, most hydrogen supplies have been consumed domestically due to challenges in long-distance hydrogen transmission and the lack of international off-takers.

Given the current challenges and market conditions, NEA’s newly launched policy provided a list of projects that are considered qualified as “pilot demonstration projects”. In China’s context, the shortlisted demonstration projects are expected to receive financial support from national and provincial governments, enjoy better interest rates for loans, set standards and templates for future projects, and get on the fast track for commercialization.

“The shortlisted projects focus on three perspectives: decarbonizing China’s hydrogen production, tackling the logistic bottlenecks, and scaling up demand, which are also the key challenges in China’s hydrogen industry,” a Beijing-based hydrogen analyst told Platts, part of S&P Global Commodity Insights.

Boosting renewable hydrogen supplies

In the list of eligible project types, published on June 10, NEA prioritized large-scale renewable and nuclear hydrogen production projects, which means projects that have no less than 100 MW or 20,000 cu m/hour of capacity. Eligible projects are also required to integrate supply and demand, utilizing the clean hydrogen in industrial processes like ammonia and methanol synthesis, refining and producing sustainable aviation fuel.

Smaller renewable hydrogen projects are considered eligible if they are in China’s rural coastal and desert areas and can operate independently, without electricity supplies from the public power grids, NEA said, adding that such projects have a lower capacity threshold of 10 MW.

Meanwhile, NEA called for projects that leverage carbon capture and storage technologies to decarbonize hydrogen produced from fossil fuels, as well as projects that can boost the consumption of hydrogen byproducts in nearby industrial plants. The policy called for selecting pilot regions to build up industry clusters that connect suppliers and buyers for such low-carbon hydrogen.

Local analysts pointed out that large-scale renewable hydrogen production remained challenging in China and globally because the intermittency of renewable electricity could significantly impact hydrogen outputs and trigger safety hazards.

Transportation, storage and utilization

NEA also called for projects that can enable large-scale, long-distance hydrogen transportation. The eligible projects should be able to carry no less than 600 kg of hydrogen in a single vehicle or build pipelines that can transport hydrogen over no less than 100 km.

NEA said projects with a hydrogen storage capacity above 20,000 cu m would be considered eligible, without showing preferences towards any existing technologies.

From the demand side, NEA supported projects that can adopt at least 1,000 mt/year of renewable hydrogen to substitute emission-intensive fuels and raw materials in heavy industries, such as refining and coal chemical industries.

Meanwhile, NEA supported co-firing coal and gas with hydrogen and ammonia for power generation. Eligible gas-fired projects should have generation capacities above 10 MW, and the hydrogen/ammonia content should be no less than 15%. Eligible coal-fired projects should have generation capacities above 300 MW, and the hydrogen/ammonia content should be no less than 10%.

NEA also called for exploring ways to use carbon markets to finance these pilot projects.

“Different from countries like Japan and Singapore that focus more on developing international hydrogen supply chains, the latest NEA policy still focuses more on building up the domestic ecosystem first. Notably, NEA did not give any specific signals regarding maritime transportation or unlocking demand from international buyers,” the Beijing-based analyst said.

“Given the technical hurdles and market reality, China’s strategies for engagement with international customers are still exporting hydrogen electrolyzers to their markets or helping them build up renewable hydrogen projects locally, instead of exporting hydrogen or ammonia produced within China,” the analyst said.

“Looking ahead, over 245 GW of renewable hydrogen capacity has been announced in Asia Pacific. Of that, 43 GW of projects are in the advanced planning stage, and 37 GW are planned to start by the end of 2030. China has 8.5 GW of capacity under construction and 16.3 GW in the advanced planning stage, mostly eyeing to serve the domestic market,” Commodity Insights analysts said in a report titled Clean Hydrogen Production in Asia-Pacific, published on June 9.

NEA’s latest hydrogen industry report showed that, as of December 2024, China’s production cost of hydrogen fell to Yuan 28/kg ($3.85/kg), decreased by 15.6% year over year. In comparison, the NEA report showed the US PEM electrolytic hydrogen price was at $5.2/kg and the EU PEM electrolytic hydrogen price was at Eur 6.1/kg ($6.94/kg) on an annual average basis in their respective key markets, citing Platts data.

By Ivy Yin – Energy Transition Market Specialist / June 13, 2025.

PBF Energy (PBF) Gained Over 15% This Week. Here is Why.

The share price of PBF Energy Inc. (NYSE:PBF) surged by 15.02% between June 5 and June 12, 2025, putting it among the Energy Stocks that Gained the Most This Week. Let’s shed some light on the development.

Aerial view of an oil refinery, with smoke billowing from its chimneys.

PBF Energy Inc. (NYSE:PBF) is one of the largest independent petroleum refiners and suppliers of unbranded transportation fuels, heating oil, petrochemical feedstocks, lubricants, and other petroleum products in the United States.

PBF Energy Inc. (NYSE:PBF) shot up this week after analysts at Wells Fargo raised the firm’s price target from $18 to $21, while maintaining an ‘Equal Weight’ rating. Given seasonality and persistently narrow crude differentials, Wells Fargo continues to favor the large refiners over the smaller ones.

Moreover, it was reported last week that UBS analysts have maintained their ‘Buy’ rating on PBF Energy Inc. (NYSE:PBF), while reiterating a price target of $26.

While we acknowledge the potential of PBF as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

By: Sultan Khalid / 13.06.2025

Shell to boost LNG capacity to 12mt by 2030

The projects contributing to this capacity boost include those in Canada, Qatar, Nigeria and the UAE.

il and gas company Shell has announced plans to expand its capacity by up to 12 million tonnes (mt) by the end of the decade, reported Reuters, citing Shell’s Integrated Gas president Cederic Cremers.

This increase is attributed to several projects currently under construction, as confirmed by Cremers.

Cremers stated: “That is not an ambition. Those are all projects that are currently in construction.”

The projects contributing to this capacity boost include those in Canada, Qatar, Nigeria and the United Arab Emirates (UAE).

Shell’s current buying capacity stands at approximately 70 million tonnes per annum (mtpa) of contractual liquefied natural gas (LNG).

Shell LNG Marketing and Trading delivered nearly 65mtpa of LNG to more than 30 countries last year.

In addition to construction projects, Shell is also enhancing its supply capabilities through strategic acquisitions and partnerships.

Cremers highlighted the recent acquisition of Pavilion Energy in Singapore, which was completed by the end of the first quarter, and contracts with third-party suppliers as key to its strategy.

Looking to the future, Cremers noted that by 2030, a significant portion of new supply, around 60%, is expected to come from the US and Qatar, with demand primarily driven by Asia and sectors that are challenging to electrify.

Shell earlier this year projected that global LNG demand could surge by around 60% by 2040, spurred by economic growth in Asia, the impact of AI, and initiatives to reduce emissions in heavy industries and transportation sectors.

Earlier this month, Shell announced the final investment decision to initiate production at the Aphrodite gas field in the East Coast Marine Area in Trinidad and Tobago.

By: Offshore-technology / June 12, 2025

California fuel imports hit 4-year high amid refinery outages

NEW YORK, June 9 (Reuters) – California’s fuel imports rose to the highest in four years in May as refiners turned to historical trading partners in Asia and tapped some unusual routes to make up for shortages in the No.2 U.S. oil consumer state, according to shipping data and traders.

The rise in shipments to California offers an early look at the future of the biggest gasoline and jet fuel markets in the U.S., which are expected to become more reliant on imports after Phillips 66(PSX.N), opens new tab and Valero(VLO.N), opens new tab close two major refineries in the state by next year, amid growing regulatory and cost pressures, and declining demand for gasoline.

“California’s refining capacity is shrinking faster than its fuel demand is declining, forcing the state into a long-term import-dependent position,” Kpler analyst Sumit Ritolia said.

California’s total petroleum product imports rose to 279,000 barrels per day (bpd) in May, the highest since June 2021, when a similar volume was imported, according to data from vessel tracker Kpler.

About 187,000 bpd, or nearly 70% of the imports came from South Korea and other Asian exporters, who have historically been the top trading partners for California and other West Coast states, which are geographically isolated from major U.S. refining centers along the Gulf Coast.

Recent outages in California at refineries owned by Chevron (CVX.N), opens new tab, PBF Energy (PBF.N), opens new tab and Valero(VLO.N), opens new tab caused a supply crunch in markets along the U.S. West Coast that necessitated more imports, traders and analysts said.

“We have seen tighter supplies due to several refinery outages,” StoneX oil analyst Alex Hodes said. That boosted prices in the U.S. Pacific Northwest substantially and led to increased imports, he said.

There were several days where San Francisco gasoline was more than $40 a barrel above Gulf Coast pricing, nearly double the year-to-date average of $21, WoodMac analyst Austin Lin said.

Flows on the route from the Caribbean were sporadic before this year’s refining outages, averaging just 6,000 bpd throughout last year, the data showed.

The Bahamas does not refine oil but exports fuel and blending components shipped there from the U.S. Gulf Coast refining hub as part of a workaround to a century-old U.S. shipping law to supply fuel to the East Coast when pipeline shipments are insufficient.

The Jones Act bars movement of goods between U.S. ports unless carried by ships built domestically and staffed by local crew. However, there were only 55 such petroleum tankers as of the start of 2024, according to a government report, making them expensive and hard to procure.

Sailing a tanker from Texas to California via the Bahamas is typically too expensive, but the recent refinery outages opened up the arbitrage to the West Coast from everywhere, a second U.S. gasoline trading source said.

By: Shariq Khan and Nicole Jao / June 9, 2025

Could MARA be readying to team with Exxon or Aramco on flare gas Bitcoin mining?

Bitcoin meets Big Oil in what could be the industry’s most ambitious flare-gas mining play yet.

Could MARA (formerly Marathon Digital) be in exploratory talks with Exxon Mobil and Saudi Aramco to colocate Bitcoin mining units at oilfields, directly tapping flare-gas for power?

Crypto Twitter thinks it’s possible, and if confirmed, the partnership could turbocharge the scale and legitimacy of gas-to-Bitcoin operations, turning waste methane into a monetized digital asset while addressing ESG concerns.

MARA stock pumper Cryptoklepto thinks, “It is more likely than not that at least one of these scenarios plays out in the next 6 to 12 months for $MARA.”

While none of the companies have formally announced a deal, MARA CEO Fred Thiel hinted at “discussions with some of the largest energy companies in the world” on May’s earnings call, adding that “chunks of flare-gas generation” will soon come online where we’re able to deploy our Bitcoin mining operations.

The timing aligns with Aramco’s May 2025 announcement of 34 new MoUs with U.S. firms and follows Exxon’s earlier pilot with Crusoe Energy in North Dakota.

Pilot-Proven, Ready to Scale

MARA isn’t starting from scratch. In late 2024, it launched a 25-megawatt pilot in Texas using stranded shale gas, avoiding grid competition while qualifying for methane abatement credits. “The AI guys are prepared to pay almost any price for energy,” Thiel told Reuters. “Bringing crypto-mining to the raw power supply lets us avoid that fight.”

The company’s mobile, plug-and-play infrastructure is tailor-made for oilfields. These portable modules convert otherwise flared methane into electricity, which is then used to mine Bitcoin, a process that Exxon and Crusoe demonstrated at scale by diverting 18 million cubic feet of gas per month and cutting CO₂-equivalent emissions by up to 63%.

Saudi Aramco has previously denied any intention to mine Bitcoin. In 2021, the company labeled such reports “false and inaccurate.”

However, MARA’s Thiel recently claimed the firm has 4–5 gigawatts of excess capacity, a scale that could power tens of thousands of mining rigs. If even a small portion were redirected, it would surpass the total output of many standalone crypto facilities.

Exxon, meanwhile, has the institutional memory and data from its two-year Crusoe pilot, which could make fast-tracking a new venture with MARA less speculative than it seems.

Why Now? A Confluence of Pressure and Opportunity

Behind the scenes, regulatory momentum is building. A U.S. methane emissions fee under the Inflation Reduction Act kicks in this year, pushing oil producers to find ways to reduce or monetize their emissions. Flare-gas mining offers a low-capex, high-upside path to compliance, particularly when paired with carbon offset markets.

Further, bills have been approved in Texas specifically to encourage Bitcoin mining using flare gas.

At the same time, Bitcoin miners are grappling with compressed margins following the April 2025 halving. MARA, one of the industry’s largest listed players, produced 950 BTC in May but must now aggressively pursue sub-$0.03/kWh energy sources to remain competitive. Flare-gas, once a fringe energy input, could become a post-halving lifeline.

Skepticism remains warranted. No SEC filings, public agreements, or official comments confirm the Exxon or Aramco partnerships. Given Aramco’s past denial, any shift in stance would likely involve months of permitting, infrastructure build-out, and reputational calculus.

If oil majors greenlight Bitcoin mining at the wellhead, the flare-gas conversation will shift from “can it work?” to “how fast can it scale?” MARA, with its turnkey modules and Wall Street footprint, may be first in line.

What to Watch

Public filings or MoUs from Exxon, Aramco, or MARA confirming pilot collaborations.

Energy regulator responses to flare-gas mining amid the methane fee rollout.

Q3 production updates: MARA’s energy costs and BTC yield per site.

Community pushback around noise and emissions from MARA’s Texas flare site.

“You’re going to find is a mix of thermal, a mix of wind, solar and some flare gas. It really depends on the market and the partner.

We’re in discussions with some of the largest energy companies in the world that have a mix of all those energy sources and nuclear.

In regards to flare gas, there are a lot of gas assets around the world that are very applicable to this method…

And what I think you’ll see us doing more and more in the future is as we continue to work with especially oil and gas producers, you’ll see chunks of this flare gas type generation come online in different parts of the world where we’re able to deploy our Bitcoin mining operations, as a way to monetize that stranded gas. And we are super excited about those opportunities.”

By: Liam ‘Akiba’ Wright / Jun. 9, 2025