Bitcoin Miner TeraWulf Sells 25% Stake in Nautilus for $92 Million

Bitcoin mining firm TeraWulf has sold its 25% stake in the Nautilus Cryptomine joint venture to its partner, a subsidiary of Talen Energy, in a deal worth about $92 million.

The company plans to use the funds to expand its operations at the Lake Mariner facility, including building the 20 MW CB-1 operation for hosting AI and high-performance computing (HPC) data centers. Additionally, TeraWulf also said that it is working on completing its fifth mining building, MB-5, and aims to reach a capacity of over 13 EH/s by early 2025 while improving mining efficiency to 18.2 J/TH.

TeraWulf’s Strategic Move

According to the official press release, TeraWulf is strategically preparing for the future by monetizing its interest in a power contract and ground lease set to expire in June 2027. This move is expected to allow it to focus resources on its Lake Mariner facility in New York, where it can benefit from lower power costs.

Selling its minority stake in Nautilus will also simplify its financial statements, improving clarity for shareholders. Recently, TeraWulf completed a 2 MW proof-of-concept project for AI and high-performance computing (HPC) that supports current and next-gen GPU technologies.

The company is also building a 20 MW colocation facility, CB-1, at Lake Mariner, designed to support a critical IT load of 16 MW with advanced cooling and redundancy features.

Reinvesting the proceeds from the sale will keep CB-1 on schedule to become operational in Q1 2025. A subsequent building, CB-2, is planned for completion in Q2 2025 and targets a gross capacity of 50 MW.

Commenting on the latest development, Paul Prager, Chief Executive Officer of TeraWulf, said,

“Monetizing our interest in Nautilus ahead of the 2027 expiration of the highly advantageous 2¢/kWh power contract allows us to capture a significant premium for our investment, provide significant capital to invest into our HPC/AI infrastructure, and capitalize on our favorably structured miner purchase agreement to upgrade our mining fleet at a discount to the current market price.”

TeraWulf’s Mixed Q2 2024 Results

TeraWulf’s second-quarter earnings report, released in August, showed mixed results. As reported earlier, the company mined 699 BTC, down 21% from last year, but revenue reached $35.6 million, slightly above the expected $35.4 million.

However, the company documented a loss of $0.03 per share, worse than the anticipated $0.02 loss. Additionally, mining costs surged 243% due to higher network difficulty and the effects of April’s Bitcoin halving.