In this episode of Energy Newsbeat – Conversations in Energy, Stuart Turley talks with Mark Lancaster about solving the stranded gas challenge by turning wasted natural gas into energy for Bitcoin mining and data centers.
Lancaster explains how his company provides fast, scalable natural gas generators, which cut project timelines and reduce emissions. They discuss the impact of Biden-era policies, grid backup requirements for data centers, and how Bitcoin miners help oil producers monetize gas. Lancaster also highlights investment opportunities in energy infrastructure, including portable LNG, with scarcity driving demand across the oil, gas, and power sectors.
I had an absolute blast talking with Mark, and we have another podcast scheduled for recording in a week with Steve Reese to discuss the impact on the United States grid. I learned a great deal and look forward to next week's interview.
Additionally, for our Substack subscribers, our videos here are ad-free, unlike those on YouTube. I also have another interview with Doomberg coming up, covering the California National Security issues.
This podcast with Mark follows the passage of the Big Beautiful Bill and an article I published about how natural gas could be impacted.
Mark, thanks for stopping by - Stu
Connect with Mark on his LinkedIn here: https://www.linkedin.com/in/marklancastermidland/
If you need power for your data center or Bitcoin mining, let us know here: https://energynewsbeat.co/turning-black-gold-green/
Highlights of the Podcast
00:00 - Intro
01:27 - Biden Policies & Gas Shutdowns
03:42 - Generator Shortage & Fast Solutions
04:46 - Backup Power for Data Centers
05:28 - Cheaper Power than Turbines
06:14 - Permit Delays & Regulatory Hurdles
08:11 - Bitcoin Helps Oil Producers
09:31 - Oilfield Jargon Explained
10:20 - Oil Culture & Landman Series
11:33 - ESG, Energy Policy & Trump
12:57 - Monetizing Stranded Gas Fields
13:51 - Bitcoin Mining Investment Returns
15:25 - Bitcoin in U.S. Treasury?
16:04 - Crypto Financing Challenges
16:15 - Remote Generators & Automation
17:04 - AI Visualizing Energy to Bitcoin
17:27 - LinkedIn & Energy Influence
18:00 - Scarcity in Energy Gear
19:52 - LNG Trucks vs EV Hype
21:23 - Final Takeaways & Contact
For the full transcript, check out
Stuart Turley [00:00:07] Hello everybody. Welcome to the Energy Newsbeat Podcast. My name is Stu Turley, President CEO of the Sandstone Group. Today is an exciting day because I get to talk to Mark Lancaster. He is the head dog over there at turning black gold into green. I'll tell you what, Mark is a cool cat. He's a friend of the show. He has been on the podcast before, and we're going to talk about some critical energy topics today. We're talking about not only data centers, AI, we're talking Bitcoin mining, but we're talking stranded gas in the environment.
Stuart Turley [00:00:40] Welcome, Mark. Thank you for stopping by.
Mark Lancaster [00:00:43] Nice to see Stuart Stewart. It was a long time ago when we did that first podcast. Yep. Number 100 or so I can't, you're up six or 700 now you're just.
Stuart Turley [00:00:53] We're getting out there, Mark. And I'll tell you, we're approaching, we'll going to go over probably a thousand here before too long. So it's been a while and the success of the show, Mark, is because of my guests. And I truly appreciate you. You're a leader on LinkedIn and you've got some great things that you've been pushing out there. I like your leadership in the energy space because right now with AI data centers and Bitcoin miners, let's kind of, can you lead us through. The path of where you've been over the last four years and where you're going now.
Mark Lancaster [00:01:28] Well, sure. You know, back four or five years ago, we were talking about stranded gas was the bane of the existence of oil companies. And it wasn't really the fact it was problematic or anything. It's just, they weren't making any money off of it, you know? And so then the Biden people came along and they basically made it a forbidden thing to have gas that was either vented or flared. And the oil operators, they did the simplest thing. They liked to reduce expenses. So they just closed all these wells in that had been venting or flaring X amount of gas. Now, everybody wants to make profit off this gas. And, you know, Bitcoin data centers, you are great users of that, you know, and so two, two and a half years ago, you saw flood of people going. Buying all of the generators and turbines that were in the market to take care of that natural gas and put it into energy, put it to the grid, put it data centers, put to Bitcoin mining. The problem that happened was there's just no more generators. There's no more turbines. You know, so I saw that need and developed a couple of projects with some packagers so that we can build natural gas gensets, put them out, you know, we can make 100 megawatts of gensets 75 days and get them on location, you know, and we do it in such a way that the ginsets are designed for redundancy, which are big on the oil field, designed to completely eliminate their emissions, is designed to have two years worth of warranty, you know, we ship everything straight to the operator so that, you know, that we can eliminate as many headaches as possible. You know, We also do. Not only natural gas, but we can do landfill gas. We can do the redundancy on data centers with diesel generators, and we can also build turbines, simply because we found niches of manufacturers that were not part of the GE world where the big countries weren't going to them. So now we have the opportunity to be able to put 40 megawatts out on a company real quick. Just bid a deal yesterday for 32 megawatts. You can have it installed in less than 12 weeks.
Stuart Turley [00:03:44] This is huge, Mark, because when you take a look, let's take a look at Stargate just right now in Abilene, they can't get their turbines in fact, so they're having to use jet-engined or modified stepping stone, and they're going to use that just to get it started fired up and rolling, and then they're going to us those as backup turbines later on and keep them as a backup. And now with SB six, I believe that governor Abbott just signed in that the data centers and everything else are going to be responsible for their own backup because they could be shut off the grid at any moment. So your solution is what I just heard is that you could come in, get a Bitcoin miner operation or a company of sizable data, and then have them ready, have them staged until they could get their turbine ready. And then those units could be used as backups as the brand new law that's that governor Abbott just signed in. This is huge.
Mark Lancaster [00:04:47] Yeah. And with data centers, they make a lot of money if they have a backup, you know, if they, you know, they have tier four redundancy, they make a significant amount more money. They can charge to their clients because of that, you know, and so actually the data centers are more profitable these days than Bitcoin mining. But the problem is the data center needs to be a hundred, 200, 300 megawatts. We also sell 11.2 megawatt generators that we can build in, you Six to seven months. And those have gotten to be very, very popular with these data centers because they're half the price of turbine power. And they're much more efficient than turbines.
Stuart Turley [00:05:29] The flexibility is so critical right now because when, you know, our great Secretary of Energy Chris Wright, who I just released at the time we're recording this, I released an article that he did an interview with Maria Bartiromo. And I really applaud him for he and Secretary Burgum and Secretary Lee Zeldin for going out and becoming the three horsemen of sanity in energy. This is refreshing. And we would not be able to have this kind of a breakthrough mark, but you're filling a need that is critical. We're not, when we originally talked about stranded gas, that's still a big issue. And you ran into some headaches with that stranded gas about the Biden administration, we were talking about it before the show. What was that issue?
Mark Lancaster [00:06:15] Well, when, when Biden came in, they, you know, they would talk about there's six or 7,000 permits that the oil companies had and they weren't doing nothing with them, but they had also had made all the oil company's re-change their permits and change the language to have the proper pronoun. You know, so all these guys had to go back in and re-edit. You know you had, if you have to go and re edit a 70 page document to change all of the I's and E's and whatever, you started that.
Stuart Turley [00:06:44] Days and days. Yeah, jeez. What a waste of taxpayer money.
Mark Lancaster [00:06:48] Well, that's government, but then also you run into the fact that when an oil company gets a permit on day one, they normally have to wait till day 700 before the electric grid can come out to wherever they're drilling. But with data centers and Bitcoin miners, they can drill the well on day two and put the oil into the tanks and the gas they can give or sell to the data center the Bitcoin miner. And get rid of that gas. And so now they can be operating. So instead of waiting six or 700 days, they can operating tomorrow. You know, that's something I think the oil companies are just now finally realizing. You know, because now you have the big guys like, you know, Devin, Exxon, Chevron, Oxy, all looking at how to incorporate this new market, you know, cause that was always the problem with gas in the oil industry is that, you know, you had a monopoly of where you could sell your gas, right? Cause there was always just a pipeline close to a field. And so you had to sell your gas for whatever that guy would buy it for, not what you saw it on CBS news that night. You know, they might report natural gas as $4 in MCF, but out here in West Texas, you're paying somebody 30 cents in MCS just to take it away, you know?
Stuart Turley [00:08:12] You got to make money on it. And so you have so many contacts round the whole oil and gas base. Do Bitcoin miners help EMP operators offset costs? I mean, is that a real thing out there right now?
Mark Lancaster [00:08:27] Yeah, you know, and the hardest part is getting both to talk the same language, you know, because, you, because oil field people don't understand blockchain and blockchain people don't understand the safety problems you're running to then drilling their oil well, you now, and so we try to act as the intermediary between the two and say, Hey, you need to think about this. You need to thing about that. You know, I was talking to some guys the other day and You know, the one funny safety joke in the oil field is that you have a, you know, some girl from the human resources run into an office and say, oh no, you know, there's four dead men on the well site. And operators said, well, that's great. And that's because, well whenever you see an oil work over rig, it's tied down on the, well to these dead men, they're basically screws that are in the ground. So it gives them a place they can tie their guy wire so that the big tower doesn't fall over and they're called dead men. So you say that to anybody else that's not an oil field and they'll be concerned.
Stuart Turley [00:09:32] Yeah, I was sitting there kind of going, I knew the punch line coming, you know, as I'm sitting there going, okay, where are you going with this Mark? But I knew an answer to that.
Mark Lancaster [00:09:40] Big winners. Thank you. They're watching an episode of Goodfellas or something.
Stuart Turley [00:09:44] Or basically land man, the new episode, everybody wants to be Billy Bob Thornton and survive a cartel mugging, you know? So, I mean, it's.
Mark Lancaster [00:09:54] Yeah, that's really interesting. I'll interject if you, if you see here in my background, I've got a little pumping unit and a friend of mine, Bill's O's, Brad ball, and he's actually in land man. They just shot his episode yesterday. No way. They're, they, they created a mock-up of, of a oil show and he has all of his little oil field tools at booth and they're going to display that on land.
Stuart Turley [00:10:21] How sweet now can we can you I want to get his information because I'd love to buy one so he said
Mark Lancaster [00:10:27] And he, he builds these working models of pump jacks, full batteries. You know, he, he's a wizard. Yeah. I want to buy one.
Stuart Turley [00:10:39] Little oil field toys. Okay. Cool. Cause that, that would be a great backdrop for my desk. I just, that is outstanding. And we want to give him a shout out on this in the show notes too, but I tell you, I, I have respect. I like the land man show from the standpoint that it is, there's a narrative Mark that you've alluded to at the beginning part, and that was the previous administration's dirty language on oil and gas. And this current administration is changing the narrative and landman, even though some of it's a lot fictitious, it's, a lot of it true. I mean, life in the oil field, there's great people. They're the Cowboys of the United States. Now the, our great oil and gas folks.
Mark Lancaster [00:11:24] Yeah, there was one scene that Billy Bob Thornton was talking to the lawyer and he was explaining to her the cost of a windmill.
Stuart Turley [00:11:33] Isn't that a great scene? That is that to me when Billy Bob was going through that, but ESG has really had a great toll on the United States, oil and gas exploration as a industry. The governance and the commitment of oil and gas operators to give money back to their shareholders and stakeholders. It's not the old school days that used to be. It is really a whole different environment. So when president Trump, as I put out in my article this morning, when president Trump, Trump stands up there and says drill baby drill, and I mean, now the oil and gas industry is going, well, not so much president Trump we're going to do it, you know, I, that's almost a cross between Putin and Fonzie. I don't understand which one, but we're gonna be drill baby drill when fiscally responsible. And I think. Tapping into what your solution is is so I'm excited about your solution because this is cool because it's going to be able to help EMP operators. They're trying to pull the oil out, but yet they got stranded gas or you're a data center and you've got a long time lead. You're almost in a perfect environment for about 16 different business models. And I can see how this could fan out and be a real solution for a lot of folks.
Mark Lancaster [00:12:57] I was just talking to a friend of mine this morning. He's got, he's got a field with 600 wells, they can't move the gas and they, and they make 50 to 900 MCF the day on those different wells and different gas. So it's an excellent opportunity for, you know, even a data center to come in, but they need to build the infrastructure in that. Combine all the gas into one spot, you know, and, you know, but with Bitcoin mining, you can actually have a 30 megawatt here of 300 megawat there, you know, and, and sort of bounce that out. But you wind up with somebody investing the money, you and you have the Stanley's of the world and all these investment funds and hedge funds, you know, we have a project in Ohio for 150 megawatts that a hedge fund is paying for. And And the only reason why hedge fund gets into it is because it makes money.
Stuart Turley [00:13:51] Now, are you dealing with any family offices or private investment that way as well, because it seems to me that if it's a package deal, part of the con you mentioned that the Bitcoin miners don't talk to the, you know, that we don't speak the same language and a guy wire is something that's completely different on a tower in microwaves and everything else. And it's not guy wire as in guide wire. You always hear that there's, there's the language barrier, depending on which tower you're talking about. Is it a cell tower or is it the tower where the polls go up for drilling? The huge issue here, but where we're, what we're seeing is what I had a senior moment there, I just pulled the Joe Biden, holy smokes, Batman.
Mark Lancaster [00:14:36] Well, I'll give you a really good example. Everybody in the world knows where Butler, Pennsylvania is. And we're doing a project 30 minutes north of Butler, Pennsylvania, where the investment cost is $5.7 million for a five megawatt Bitcoin mine. And the return on investment will be a net of $300,000 a month, which gives them payback in 16, 17 months. You know, and when you, you know, way investment company, I mean, that's, that's really what you're looking at. And that's assuming that Bitcoin never goes up and it just stays at a hundred thousand dollars of Bitcoin, you know, I mean, so people are expecting the Bitcoin to be at, you know, one 75 or something by the end of the year. It's so hard to say.
Stuart Turley [00:15:25] Who knows, but, but as a, as president Trump is adding it to the, potentially to the United States treasury, holy smokes, that's adding some serious stability to Bitcoin. Wow. I'm sitting there trying to do the math in my head and I got past two, three fingers and I'm like, wow, that a lot.
Mark Lancaster [00:15:45] Yeah. And that's, that's really the problem that sort of Bitcoin does have is it's a, it's, uh, big investment number in the, in the first place, right? You it's hard to finance the worst thing in the world is to try to open a bank account and say, you're into crypto because we go that, that, that don't work and you have to do something else.
Stuart Turley [00:16:05] Either private equity or family offices seem that to be a perfect target for this and that kind of helps direct me where I need to look as well. I mean, when you sit back
Mark Lancaster [00:16:15] Yeah, the return on investment is almost, it's just simple and it's so automated. You know, our generators are all remotely maintained. We can turn, I can turn on a generator from my office here in Midland and in Alberta, Canada. Wow. You know? And the maintenance for the miners is all the same as, you know, the redundancy, all the little problems that people used to have four or five, six years ago with all this stuff has been designed out. You know that's that's the whole key you know i mean if you can eliminate manpower that's why ai is so important we're creating an animation that shows how natural gas goes from natural gas and generator to bitcoin to being a currency and wow that's what people understand you'll it on my LinkedIn here later today.
Stuart Turley [00:17:05] I can't wait that that is, that is really cool. You got a cool cat LinkedIn. You got a bunch of followers out there, dude.
Mark Lancaster [00:17:12] And we're about at about 28,000. So we get a lot of views, whatever we put up there. And, you know, and I think it's funny. I'll go to an oil show or crypto show and somebody says, Oh, you're Mark Lancaster. You're you're famous. I mean, tell my.
Stuart Turley [00:17:27] Or, or in the, in the words, it was an L WAPO in fame. Is it famous or in famous? So I love that movie with Steve Martin and the, the three musketeer three or whatever the, yeah. Anyway, that was a great one. I always, always loved that L WAPPA who played in that movie in famous or, or famous. But as we go forward, Mark, this is an exciting time to be in an energy space. How do people get a hold of you? We mentioned LinkedIn and we'll have your LinkedIn thing in there. What are other assets do you see coming around the corner?
Mark Lancaster [00:18:00] Well, you know, I mean, the, the biggest thing is you always want to go to wherever scarcity is, you know, cause scarcity drives any economic boom, you know, and right now scarcity, for example, in power generation is, is what they call switch gear. You know, a lot of people will go on that want to put a turbine in and a turbine outputs, let's say 25 megawatts of electricity, and then they want to set up a data center. Well, the problem is that you have to take that... 25 megawatts of electricity and split it up to all those different containers. And that requires something called switch gear. We talked about generators or three to five years back up. Well, switch gear is five to 10 year backup because there's just none out there. You know, so when we go to design a project, we try to set the generators to match with the power output that the power input that the containers need. So we have a one-to-one ratio and then we don't have to have the switch gear. So we've eliminated one of the blocks in there, you know, so.
Stuart Turley [00:19:06] Also a limited failure point.
Mark Lancaster [00:19:08] So it makes it easier and quicker for us to put something up, you know? And, and so, you have scarcity is where you go, you know, I mean, the oil field, you know, is looking at scarcity as far as, you know, like LNG, you know, they got a lot of gas, but now we want to make it, we're making all these LNG deals with third world countries. And so now a lot of people are trying to get deals on LNG. I know people building LNG plants on the And on the golf course, yeah, and. Then you have portable LNG plants that you can take some of the stranded gas, turn it into liquid gas and send it out. I mean, there's a lot of those types of opportunities that are going out there, but with Scarcity's the driver on most stuff in
Stuart Turley [00:19:52] What a lot of folks are not picking up on is that China has already, even though they're in this, they're down a little bit in their LNG imports, they are migrating to LNG trucks. And I think that CNG, compressed natural gas, and LNG has a lot longer road and faster way to reduce emissions than people are really picking up on in the US right now. The migration to an LNG truck industry is cheaper than going to an EV and better for the environment and cheaper. So, you know, you're going to be able to get a million miles off of an LNG truck engine, just like you can a diesel truck with half the emissions. So I see that going on a long way and that's going to be the change in the molecule. Purchasing the people are looking at, but guess who's still important. The oil and gas exploration companies, they're all going to be drilling for. It just depends on which one you're drilling for, but boy, I like the way you think Mark, cause you're sitting there going to go to scarcity and I've, I'm sitting here thinking about this. I've got about six more interview topics that I want to cover with you on the next few of them here. Please, I'm looking forward to our next visit. And again, I'll have your LinkedIn information in the show notes so that people can go out and find you on LinkedIn. Thank you for your time today. I really appreciate you.
Mark Lancaster [00:21:24] Thanks, sir.
Stuart Turley [00:21:24] We'll see you soon.
For a total turn-key installation of a Natural Gas generator, check out https://energynewsbeat.co/turning-black-gold-green/
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