Crusoe Energy Systems Closes $4.5 Million Seed Funding Round Co-Led by Bain Capital Ventures and Founders Fund Pathfinder

Company helps oil and gas companies mitigate natural gas flaring and
reduce harmful emissions while harnessing the gas to power compute
intensive datacenters

DENVER–(BUSINESS WIRE)–Crusoe
Energy Systems, Inc.
, a technology driven flare mitigation provider,
today announced it has successfully completed a $4.5 million seed
financing round led by Bain Capital Ventures and Founders Fund
Pathfinder, with additional participation from Wicklow Capital,
Winklevoss Capital and Dragonfly Capital Partners. This investment
brings Crusoe’s total funding to $5.1 million. Funding proceeds will be
used to accelerate production of Crusoe’s mobile modular data centers to
provide large-scale flare mitigation service for oil and gas operators
across North America.

Crusoe enables oil and gas producers to transform their wasted natural
gas into electrical power at the wellsite, eliminating the need for gas
flaring and significantly reducing environmentally harmful emissions. By
converting natural gas to energy-intensive computing, Crusoe’s Digital
Flare Mitigation (DFM) service achieves a beneficial use for natural
gas, which would otherwise be burned onsite because it is too costly and
complex to transport elsewhere. Compared to flaring, Crusoe’s process
also achieves over 99% reductions in emissions of volatile organic
compounds (VOCs), nitrogen oxides (NOx) and carbon monoxide (CO), which
otherwise form smog.

“Crusoe is excited to announce this funding from a consortium of
industry-leading technology investors. With their support, Crusoe is
expanding our service offering to solve critical regulatory and
environmental challenges for oil and gas operators,” said Chase
Lochmiller, Co-Founder and CEO of Crusoe. “We are committed to building
advanced technologies for flare mitigation that are capable of handling
the large-scale gas throughputs required by today’s North American shale
industry. Crusoe’s technology harnesses otherwise wasted energy for
growing industries that require energy intensive computing, such as
blockchain and artificial intelligence.”

Crusoe’s DFM systems are designed as modular, portable, containerized
data center units, which can be deployed and commissioned in a matter of
days to quickly reduce or eliminate flaring. Systems are scalable up to
millions of cubic feet per day and can be deployed anywhere in the
United States or Canada.

Salil Deshpande, Partner at Bain Capital Ventures, said, “It
seemed ironic and broken to us that oil production gets limited by how
effectively producers can handle natural gas. Bain Capital Ventures is
excited to support the Crusoe team, which combines significant oil and
gas industry experience with deep technical expertise around
energy-intensive computing. The scale and technical sophistication of
Crusoe’s digital flare mitigation system, as well as its execution in
the field, is unique. Crusoe solves an important pain point for oil
producers in the booming shale industry, and we’re enjoying working with
the team as they advance and scale digital flare mitigation service
across North America.”

Background on Flaring

Natural gas flaring has become an acute pain point for shale oil
producers, which produce natural gas as a byproduct of oil drilling.
This oil-associated natural gas production has outpaced gas pipeline
infrastructure in many parts of the North American shale boom. In the
absence of adequate pipeline capacity, operators tend to burn natural
gas in a process known as “flaring” or “combusting.” Approximately 335
billion cubic feet of natural gas are flared annually in the United
States, according to latest 2017 data from the World Bank’s Global Gas
Flaring Reduction Partnership (GGFR), which is enough gas to power more
than 7 million U.S. homes.

Flaring generates pushback from the public and policymakers, who
increasingly raise environmental concerns around resource waste, visual
impacts and air quality. State-level regulators are tightening
regulations against flaring and associated air quality issues, which
jeopardizes existing and future shale oil production.

About Crusoe Energy Systems Inc.

Crusoe Energy Systems provides innovative solutions for the energy
industry. By converting natural gas to energy-intensive computing,
Crusoe’s Digital Flare Mitigation service delivers an environmentally
sound way to create a beneficial use for otherwise wasted natural gas.
Crusoe offers solutions to solve the gas flaring challenge for oil
producers without upfront cost or operational complexity. Crusoe
currently has flare mitigation projects operating or under development
in North Dakota’s Bakken oilfield, Wyoming’s Powder River Basin
oilfield, and Colorado’s Denver-Julesburg oilfield. Systems are scalable
up to millions of cubic feet per day and can be deployed anywhere in the
United States or Canada.

About Bain Capital Ventures

Bain Capital Ventures partners with disruptive founders to accelerate
their ideas to market. The firm invests from seed to growth in startups
driving transformation across industries, from security and cloud
infrastructure to logistics and e-commerce to finance and healthcare.
The firm has helped launch and commercialize more than 240 companies,
including DocuSign, Jet.com, Kiva Systems, LinkedIn, Rapid7, Rent The
Runway, SendGrid, SurveyMonkey, Taleo, TellApart and Turbonomic. Bain
Capital Ventures has $4.9 billion in assets under management with
offices in San Francisco, New York, Boston, and Palo Alto. Follow the
firm via LinkedIn or Twitter.

Contacts

Chase Lochmiller
Co-Founder and CEO

Cully Cavness
Co-Founder and President

info@crusoeenergy.com

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