A crypto mining company plans to redevelop a northeastern North Dakota anti-ballistic missile site abandoned in the 1970s into data center that may be used for the mining of bitcoin and other digital currencies, Gov. Doug Burgum announced Monday.
Bitzero Blockchain Inc., which is backed by strategic investor and “Shark Tank” star Kevin O’Leary, announced last month that it planned to make North Dakota its headquarters for North American operations. The company said within three years it intends to build 200 megawatts of data centers in the state and is involved in a joint venture to become an assembly and distribution hub for graphene battery technology.
Long considered a white elephant and waste of taxpayers’ money, the site at Nekoma grew out of a 1972 treaty between the United States and the Soviet Union.
The $6 billion Stanley R. Mickelsen Safeguard Complex once housed a radar system within a concrete pyramid, with 7-foot-thick, steel-reinforced walls. It was deactivated in 1976 after only a few months of operation. Nekoma’s population reached several hundred, compared with about 30 today, and surrounding towns benefited from an influx of highly paid missile experts and support personnel.
The Cavalier County Job Development Authority has owned the site since 2017. Spokeswoman Carol Goodman said the facility would be sold to the company for $250,000.
Burgum said waste heat captured from the data center’s servers will be used to heat an on-site greenhouse, and the company also is planning an interpretive center, representing a total investment estimated by Bitzero at $500 million.
“This important piece of history will be restored and become a beacon for North Dakota innovation to the rest of the world,” Burgum said.
Bitzero has signed leases in both Bismarck and Fargo for administrative operations. The Nekoma site will be their primary data center site in North Dakota, Burgum spokesman Mike Nowatzki said.
Separately, Burgum in January announced construction of a $1.9 billion data center located near the biggest city in the state’s oil-production region in northwest North Dakota.
The second-term Republican governor hailed the Atlas Power Data Center to be built by Missoula, Montana-based FX Solutions Inc. as one of the biggest such centers in the world, and one that will help diversify the economy in Williston-area that has suffered oil boom-bust cycles for decades.
Burgum, a wealthy former Microsoft executive, called data centers an “incredible forward- looking industry not dependent on the price of oil.”
Uses for data centers include the mining of bitcoin and other digital currencies. Cryptocurrency mining involves supercomputers to solve complex calculations needed to provide security for transactions in the digital currency.
The process requires vast amounts of power and generates much heat. Burgum has said North Dakota is an ideal place for data centers because it has a reliable and affordable power supply, and a climate that lowers cooling costs.
Burgum spokesman Nowatzki said no public money has been earmarked for any of the projects, though they are expected to qualify for tax credits already given to agriculture, energy and other industries.
