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Construction starts on new Applied Blockchain facility near Ellendale

The new facility will be located about 1 mile west of Ellendale, N.D.

APLD Ellendale Location
Equipment and materials are seen at the location of Applied Blockchain Inc.'s new datacenter near Ellendale, N.D.
Contributed / Applied Blockchain Inc.
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ELLENDALE, N.D. – Construction has started on Applied Blockchain Inc.’s new data center about 1 mile west of Ellendale.

“This is going to be absolutely great for Ellendale and the area,” Ellendale Mayor Don Flaherty said.

Applied Blockchain’s team is excited to expand into the Ellendale area, said Regina Ingel, chief marketing officer for Applied Blockchain.

“The people, the town, everybody has been warm, welcoming and kind,” she said. “They are very excited about this opportunity to bring a project like ours into the area.”

Applied Blockchain is a builder and operator of next-generation data centers across North America, which provide substantial compute power to blockchain infrastructure and support Bitcoin mining, according to its website.

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The data center provides power to blockchain infrastructure and supports high-performance computing applications, including Bitcoin mining.

“What we are doing is really expanding into other applications as well,” Ingel said. “We will be bringing other applications into our facilities.”

Cryptocurrency is a digital currency that can be used for payments or held as an investment similar to the stock market. Cryptocurrency is not a government currency and doesn’t have a central bank, interstate rates or a long history of exchange rates against other currencies.

Bitcoin is a form of cryptocurrency that exist as lines of computer code that are digitally signed each time they travel from one owner to the next. Bitcoins and other cryptocurrencies are stored in virtual wallets.

The Ellendale location was chosen because of the available power transmission capacity and excess wind generation.

“That area happened to have a lot of stranded power from North Dakota being one of the largest wind-producing states in the nation,” Ingel said.

Stranded power exists when there is more power being produced than what is being consumed.

The Ellendale facility is expected to be operational in the first half of 2023.

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The 180-megawatt facility will be Applied Blockchain’s second in North Dakota along with the 100-megawatt facility in Jamestown that went online earlier this year.

The company is also constructing a 200-megawatt facility in Garden City, Texas.

Applied Blockchain entered into a five-year Energy Service Agreement with a utility partner in Dickey County that services Ellendale, Ingel said. The facility will be built just north of the substation which is about 1 mile west of Ellendale.

She said Applied Blockchain’s facilities are data centers that house thousands of servers but are constructed differently than traditional data centers.

“The servers have different cooling and heating and other needs,” she said. “Ours do look different but they are still crunching data.”

Earlier this year, Applied Blockchain announced it entered into a five-year hosting contract with Marathon Digital Holdings Inc. for 200 megawatts of Bitcoin mining capacity. The company will provide comprehensive hosting services for Marathon’s Bitcoin miners at Applied Blockchain’s owned and operated co-hosting data centers.

“This facility is fully contracted by a customer. This customer is Marathon Digital Holdings,” Ingel said. “Their operation is to mine Bitcoin.”

Marathon Digital Holdings is a digital asset technology company that mines cryptocurrencies, with a focus on the blockchain ecosystem and the generation of digital assets, according to its website. The website states the company owns 2,060 advanced application-specific integrated circuit Bitcoin miners at a co-hosted facility in North Dakota.

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When construction is completed, 30 to 45 employees will be needed for the facility.

Ingel said Applied Blockchain will use as many local contractors as possible to construct the facility. She said the company strives to boost the local economy as well.

“What we told the town to expect is during the construction project in Jamestown, we had somewhere between 100 to 150 construction workers working on our projects,” she said. “So what it did was it filled the rooms at the hotels, the restaurants, the markets and all of these other different places. We are hoping to do the same for Ellendale and really get that influx coming in.”

Company plans to change name

Ingel also said the company plans to change its name to Applied Digital Corp. The company said in a news release the name change will more accurately reflect its services and broader business offerings to serve customers that require large computing-powered applications.

“It speaks more to what our business model really is,” she said. “It is a variety of these HPC, high-performance compute applications, not just the one, which is just Bitcoin mining. We are still very focused on building out these facilities and making sure that our customers get just top-notch service but in addition to that we will bringing other applications in. We are not leaving the crypto industry at all. We are just bringing other things in as well.”

The company's name change to Applied Digital will need to be approved by its shareholders in November.

Masaki Ova joined The Jamestown Sun in August 2021 as a reporter. He grew up on a farm near Pingree, N.D. He majored in communications at the University of Jamestown, N.D.
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