Bitfarms Doubles Yguazu Power Capacity to 200 MW with Additional 100 MW of Hydropower in Paraguay
Bitfarms (BITF) has doubled its Yguazu power capacity in Paraguay from 100 MW to 200 MW through an amendment to its Power Purchase Agreement with ANDE, Paraguay's state-owned utility.
This sustainable hydropower, scheduled for deployment in 2025, will be provided at a low cost of approximately 3.9 cents per kWh, with no annual inflation adjustments.
The construction began in March and includes major contracts and equipment orders.
This expansion is expected to increase Bitfarms' 2025 megawatts under management by 23%, from 428 MW to 528 MW, leveraging cost efficiencies from existing plans.
Paraguay represents a significant growth opportunity for Bitfarms, with 270 MW of infrastructure expansion planned at Paso Pe and Yguazu farms.
- Doubling Yguazu's power capacity to 200 MW.
- Long-term, low-cost power contracts at approximately 3.9 cents per kWh.
- No annual inflation adjustments for the power cost.
- Construction progress and major contracts already in place.
- Expansion expected to increase 2025 megawatts under management by 23% (from 428 MW to 528 MW).
- Cost efficiencies due to leveraging existing construction plans.
- No direct acquisition costs for the additional megawatts.
- Paraguay identified as the greatest growth opportunity with 270 MW of planned infrastructure expansion.
- Increased infrastructure may require significant capital expenditure.
- Risk of potential construction delays and cost overruns.
- Dependence on regulatory and operational stability in Paraguay.
- Potential market risks due to reliance on a single geographical area for significant expansion.
Insights
The recent announcement by Bitfarms Ltd. to double its power capacity at the Yguazu site to 200 MW offers a strategic advantage in the competitive Bitcoin mining industry. By securing an additional 100 MW at a low rate of approximately 3.9 cents per kWh, Bitfarms is positioning itself to reduce operational costs significantly. This low-cost, long-term power contract is particularly beneficial as it is not subject to annual inflationary adjustments, ensuring stable energy expenses.
From a financial standpoint, this expansion is expected to increase Bitfarms' megawatts under management by
Bitfarms’ decision to expand its infrastructure in Paraguay is indicative of a strategic position to leverage the region’s favorable economic conditions for Bitcoin mining. Paraguay’s hydropower resources offer a sustainable and cost-effective solution, particularly critical in an industry where electricity costs significantly impact profitability.
This move is expected to cement Bitfarms’ presence in Latin America, capitalizing on rapid construction timelines and cost efficiencies. Securing the additional 100 MW at no direct acquisition cost further highlights the company's ability to navigate and benefit from local partnerships effectively. In a broader market context, such strategic expansions can improve Bitfarms’ competitive edge against other Bitcoin mining companies struggling with higher energy costs or less favorable power purchase agreements.
For retail investors, the company’s growth in Paraguay represents not only an opportunity for increased revenue but also a step towards more sustainable and cost-efficient operations, potentially leading to a more robust market position in the long run.
From a technological perspective, Bitfarms’ expansion to 200 MW at the Yguazu site reflects significant advancements in the scalability of Bitcoin mining operations. The company’s ability to integrate the additional capacity without disrupting its 2024 targets is noteworthy. This seamless scalability is a testament to Bitfarms' adeptness in managing complex engineering and construction processes, including the high-voltage interconnection to the ANDE substation and transmission line.
The utilization of hydropower not only aligns with global sustainability trends but also ensures a stable and reliable power source, critical for continuous mining operations. By investing in major long-lead equipment and adapting construction plans to accommodate the increased capacity, Bitfarms demonstrates a forward-thinking approach to infrastructure development. These technological and operational efficiencies can enhance the company’s overall performance and reliability in the Bitcoin mining industry.
Long-term, low-cost power contracts at a competitive rate expected to provide significant path for growth
This news release constitutes a “designated news release” for the purposes of the Company’s prospectus supplement dated March 8, 2024, to its short form base shelf prospectus dated November 10, 2023.
TORONTO, Ontario and BROSSARD, Québec, May 14, 2024 (GLOBE NEWSWIRE) -- Bitfarms Ltd. (Nasdaq/TSX: BITF), a global Bitcoin vertically integrated company, secured an additional 100 MW at its Yguazu site through an amendment to the existing 100 MW Power Purchase Agreement (PPA) with the Paraguay state-owned utility, ANDE. This amendment doubles capacity at this site to 200 MW with scheduled deployment for 2025. This sustainable hydropower will be provided at a contractual low cost of approximately 3.9 cents per kWh, before VAT, with the added benefit of not being subject to annual inflationary adjustments.
Construction at Yguazu began in March with the signed purchase agreements for major long-lead equipment and significant contracts, including the engineering procurement and construction contract for the high-voltage interconnection to the ANDE substation and transmission line. Changes to construction plans and equipment orders to accommodate the incremental 100 MW are already underway.
“The additional 100 MW provides a low-cost growth path for the first half of 2025 without impacting our 2024 21 EH/s target which remains on schedule,” said Ben Gagnon, Chief Mining Officer. “Growing Yguazu to 200 MW is expected to increase our 2025 megawatts under management by
Damian Polla, General Manager of LATAM, stated, “Building upon our construction progress at our existing sites and track record in the country, this addition allows us to take advantage of the cost efficiencies and rapid construction timelines we have experienced in Paraguay. In addition, these megawatts were secured directly though ANDE with no direct acquisition costs. Overall, Paraguay represents our greatest growth opportunity with 270 MW of infrastructure expansion from our new Paso Pe and Yguazu farms.”
About Bitfarms Ltd.
Founded in 2017, Bitfarms is a global Bitcoin mining company that contributes its computational power to one or more mining pools from which it receives payment in Bitcoin. Bitfarms develops, owns, and operates vertically integrated mining farms with in-house management and company-owned electrical engineering, installation service, and multiple onsite technical repair centers. The Company’s proprietary data analytics system delivers best-in-class operational performance and uptime.
Bitfarms currently has 11 Bitcoin mining facilities and two under development situated in four countries: Canada, the United States, Paraguay, and Argentina. Powered predominantly by environmentally friendly hydro-electric and long-term power contracts, Bitfarms is committed to using sustainable and often underutilized energy infrastructure.
To learn more about Bitfarms’ events, developments, and online communities:
www.bitfarms.com
https://www.facebook.com/bitfarms/
https://twitter.com/Bitfarms_io
https://www.instagram.com/bitfarms/
https://www.linkedin.com/company/bitfarms/
Glossary of Terms
- BTC BTC/day = Bitcoin or Bitcoin per day
- EH or EH/s = Exahash or exahash per second
- MW or MWh = Megawatts or megawatt hour
- PH or PH/s = Petahash or petahash per second
- TH or TH/s = Terahash or terahash per second
- W/TH = Watts per Terahash
Cautionary Statement
Trading in the securities of the Company should be considered highly speculative. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. Neither the Toronto Stock Exchange, Nasdaq, or any other securities exchange or regulatory authority accepts responsibility for the adequacy or accuracy of this release.
Forward-Looking Statements
This news release contains certain “forward-looking information” and “forward-looking statements” (collectively, “forward-looking information”) that are based on expectations, estimates and projections as at the date of this news release and are covered by safe harbors under Canadian and United States securities laws. The statements and information in this release regarding projected growth, target hashrate, opportunities relating to the Company’s geographical diversification and expansion, upgrading and deployment of miners as well as the timing therefor, improved financial performance and balance sheet liquidity, other growth opportunities and prospects, and other statements regarding future growth, plans and objectives of the Company are forward-looking information. Any statements that involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, future events or performance (often but not always using phrases such as “expects”, or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “budget”, “scheduled”, “forecasts”, “estimates”, “prospects”, “believes” or “intends” or variations of such words and phrases or stating that certain actions, events or results “may” or “could”, “would”, “might” or “will” be taken to occur or be achieved) are not statements of historical fact and may be forward-looking information and are intended to identify forward-looking information.
This forward-looking information is based on assumptions and estimates of management of the Company at the time they were made, and involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance, or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. Such factors include, among others, risks relating to: the construction and operation of the Company’s facilities may not occur as currently planned, or at all; expansion may not materialize as currently anticipated, or at all; the power purchase agreements and economics thereof may not be as advantageous as expected; the the digital currency market; the ability to successfully mine digital currency; revenue may not increase as currently anticipated, or at all; it may not be possible to profitably liquidate the current digital currency inventory, or at all; a decline in digital currency prices may have a significant negative impact on operations; an increase in network difficulty may have a significant negative impact on operations; the volatility of digital currency prices; the anticipated growth and sustainability of hydroelectricity for the purposes of cryptocurrency mining in the applicable jurisdictions; the inability to maintain reliable and economical sources of power for the Company to operate cryptocurrency mining assets; the risks of an increase in the Company’s electricity costs, cost of natural gas, changes in currency exchange rates, energy curtailment or regulatory changes in the energy regimes in the jurisdictions in which the Company operates and the adverse impact on the Company’s profitability; the ability to complete current and future financings; the impact of the Restatement on the price of the Company’s common shares, financial condition and results of operations; the risk that a material weakness in internal control over financial reporting could result in a misstatement of the Company’s financial position that may lead to a material misstatement of the annual or interim consolidated financial statements if not prevented or detected on a timely basis; any regulations or laws that will prevent Bitfarms from operating its business; historical prices of digital currencies and the ability to mine digital currencies that will be consistent with historical prices; and the adoption or expansion of any regulation or law that will prevent Bitfarms from operating its business, or make it more costly to do so. For further information concerning these and other risks and uncertainties, refer to the Company’s filings on www.sedarplus.ca (which are also available on the website of the U.S. Securities and Exchange Commission at www.sec.gov), including the MD&A for the year-ended December 31, 2023, filed on March 7, 2024 and the MD&A for three-month period ended March 31, 2024. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those expressed in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended, including factors that are currently unknown to or deemed immaterial by the Company. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on any forward-looking information. The Company undertakes no obligation to revise or update any forward-looking information other than as required by law.
Investor Relations Contact:
Tracy Krumme
SVP, Investor Relations
+1 786-671-5638
tkrumme@bitfarms.com
Media Contacts:
Actual Agency
Khushboo Chaudhary
+1 646-373-9946
mediarelations@bitfarms.com
Québec Media: Tact
Louis-Martin Leclerc
+1 418-693-2425
lmleclerc@tactconseil.ca
FAQ
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