Cipher Mining is set to acquire a new 300-megawatt (MW) data center site in West Texas to scale up its bitcoin mining capabilities in the state.
In an announcement on Tuesday, Cipher stated it had entered into a term sheet with an undisclosed counterparty to acquire the site for a cash payment of $67.5 million and a variable fee of $3 per megawatt-hour (MWh) for the first five years following energization.
The company did not specify the expected energization schedule or the equipment purchase plan needed to fulfill the capacity.
According to the release, the transaction includes 300 MW of front-of-the-meter capacity and a “newly constructed, fully energized high-to-mid voltage substation.” Cipher described the site as being “equally well-suited for HPC infrastructure and Bitcoin mining.”
Additionally, Cipher said it will acquire 250 acres of land surrounding the substation and the agreements needed to participate in the Electric Reliability Council of Texas (ERCOT) market. It expects to finalize the transaction in September after completing due diligence.
This deal follows Cipher’s purchase of another 300 MW site, known as Black Pearl, in Winkler County, Texas, late last year. It aims to fully energize the Black Pearl site in 2025 and has recorded approximately $20 million in construction-in-progress expenses related to the facility as of June 30.
Cipher had previously preordered 7.1 EH/s of bitcoin miners for the Black Pearl site but later accelerated the shipment by paying a higher fee to Bitmain.
As a result, Cipher will use the new miners to “replace less efficient machines at the Odessa Facility instead of deploying them at the Black Pearl Facility,” the company stated in its Q2 filing.
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